Development Economist and a research Fellow at the Centre for Social Policy Studies (CSPS) at the College of Humanitiesat the University of Ghana, has stated that John Mahama left almost half of Ghana’s $51 Billion debt stock, and, therefore, the Akufo-Addo administration is not responsible for all the loans contracted by the country.
Speaking at the ABC News’ organized Economic Symposium held at the Koforidua Technical University in the Eastern Region on 5th November 2024, the guru in economist stated that since January 2017 till date, loans contracted by theAkufo-Addo government amount to $21.88. Billion.
“It is erroneous for the presidential candidate of the opposition NDC to create the impression that the Akufo-Addo administration has borrowed all the over GHC700 Billion which in dollar terms, is around $51 Billion. Akufo-Addo has so far contracted $21.88 Billion in loans, and the Mills/Mahama administration also contracted loans to the tune of $21.15 Billion” he explained.
He further explained that though at the time Mahama was leaving office, the debt stock of $21.15 Billion and in cedi terms, was around GHC122 Billion, the same amount would be more than GHC350 Billion.
“Let me state here categorically that if Akufo-Addo had not gone for any loan since he assumed office, his $21.15 Billion loans which stood at around GHC122 Billion at the time Mahama was leaving office, that amount would be more than GHC350 Billion. It is, therefore, not accurate for Mahama to accuse the Akufo-Addo administration of contracting loans to the tune of over GHC700 Billion”
Dr Domfe indicated that the reasons for the current level of the depreciation of the Ghanaian cedi cannot be blamed on the Akufo-Addo government since they were extraneous.
“One may ask why the local currency has depreciated to its current level, thereby shooting the debt levels up, the reasons are not far-fetched. COVID-19 played a critical role in the depreciation of the cedi. Production levels in Asia, Europe and North America went considerably down, thereby causing inflation across the world. These higher prices meant higher demands for dollars, and the consequence is what we are seeing today” he said.
He also said that the war waged on Ukraine by Vladimir Putin also caused significant inflation since the two countries are amongst the places where Ghana imports many commodities from. The absence of these commodities due to the war impacted on prices, and this, he said, also affected Ghana adversely.
Dr. Domfe indicated that at the beginning of 2022, Ghana’s gross international reserves stood at $9.9 Billion. This got depleted because of the war between Russia and Ukraine and the COVID-19 pandemic because of high prices of goods imported with dollars into the country.
“The higher prices of imported commodities mounted pressure on the country’s gross international reserves till they got to $2 Billion, prompting the need to seek the support from the IMF. This is to say that the depreciation of the cedi had very little to do with Akufo-Addo” he averred.
The economist also stated that President Akufo-Addo’s first term holds the best record for cedi depreciation, 27%. He held that the 6.9% second quarter growth is far better than the 3.4% growth Mahama bequeathed to Akufo-Addo. He used the occasion to appeal to Ghanaians to vote for Dr. Bawumia to continue with the sound policies and programs that are helping to change the trajectory of the economy.