The finance minister, Dr Kwabena Duffuor, had reject reports that the government has doubled the nation’s debt, according to a press statement signed by Abdul hakim Ahmed, media liaison, Ministry of Finance and Economic Planning
“It is factually wrong for anyone to suggest that this government has increased the public debt by 100 per cent in just two years because there are numerous loans that the previous administration has contracted which are still being disbursed and adding to the debt stock,” the statement stated.
The statement explained that, in 2005, the country’s external debt was US$6.3bn but dropped to US$2.bn in 2006 following the debt relief under the HIPC initiative. Soon after, the external debt increased significantly again, reaching US$4.bn in 2008. This represents 100 per cent increase between 2006 and 2008. Between 2008 to 2010, under the Mills-led government, the debt increased from US$4bn to US$6bn, or by 50 per cent. Even then the increase was attributed to the disbursement of a number of loans that were contracted during the NPP administration.
Total loans (external) contracted in 2007 and 2008 by the New Patriotic Party (NPP) government was US$1.7bn and US$2.7bn respectively. However, the NDC government’s total loans (external) contracted in 2009 and 2010 are US$1bn and US$2.7bn respectively.
“Again, it is disingenuous for anyone to insinuate that the STX loan agreement, the Industrial and Commercial Bank of China (ICBC) loan proposal for the Eastern corridor road and the Opus 7 loan proposal are part of the stock of the national debt,” the statement added.
The ICBC submitted a proposal which is currently under discussion. On Opus 7, government conducted due diligence on the financier and the result was unsatisfactory and so the transaction has fallen away.
“The Ministry wishes to state that until disbursements are done, all loan agreements remain commitments and not part of the national debt. It must be made clear that loan disbursements could take several years and could even transcend governments”.
In 2008, the domestic debt was US$4bn. It increased to US$4.2bn in 2009 and then to US$5.6bn in 2010. The increase in the domestic debt stock between 2009 and 2010 was the result of government’s borrowing from the domestic market to clear the huge arrears left by the previous government.
“Going forward, it is important to state that issues of national debts transcend governments or regimes and therefore all of us as Ghanaians must be careful not to politicize it because this has the tendency of scaring investors,” the statement concluded.
“It is factually wrong for anyone to suggest that this government has increased the public debt by 100 per cent in just two years because there are numerous loans that the previous administration has contracted which are still being disbursed and adding to the debt stock,” the statement stated.
The statement explained that, in 2005, the country’s external debt was US$6.3bn but dropped to US$2.bn in 2006 following the debt relief under the HIPC initiative. Soon after, the external debt increased significantly again, reaching US$4.bn in 2008. This represents 100 per cent increase between 2006 and 2008. Between 2008 to 2010, under the Mills-led government, the debt increased from US$4bn to US$6bn, or by 50 per cent. Even then the increase was attributed to the disbursement of a number of loans that were contracted during the NPP administration.
Total loans (external) contracted in 2007 and 2008 by the New Patriotic Party (NPP) government was US$1.7bn and US$2.7bn respectively. However, the NDC government’s total loans (external) contracted in 2009 and 2010 are US$1bn and US$2.7bn respectively.
“Again, it is disingenuous for anyone to insinuate that the STX loan agreement, the Industrial and Commercial Bank of China (ICBC) loan proposal for the Eastern corridor road and the Opus 7 loan proposal are part of the stock of the national debt,” the statement added.
The ICBC submitted a proposal which is currently under discussion. On Opus 7, government conducted due diligence on the financier and the result was unsatisfactory and so the transaction has fallen away.
“The Ministry wishes to state that until disbursements are done, all loan agreements remain commitments and not part of the national debt. It must be made clear that loan disbursements could take several years and could even transcend governments”.
In 2008, the domestic debt was US$4bn. It increased to US$4.2bn in 2009 and then to US$5.6bn in 2010. The increase in the domestic debt stock between 2009 and 2010 was the result of government’s borrowing from the domestic market to clear the huge arrears left by the previous government.
“Going forward, it is important to state that issues of national debts transcend governments or regimes and therefore all of us as Ghanaians must be careful not to politicize it because this has the tendency of scaring investors,” the statement concluded.
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