Finance Minister, Ken Ofori-Atta, has mounted a defense for government’s incessant borrowing despite cautions from the International Monetary Fund (IMF) and World Bank to the developing country to check its borrowing habit.
The two acclaimed financial institutions raised the concerns on the back of Ghana’s recently oversubscribed $3 billion Eurobond.
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But according to the Minister, Ghana’s borrowing habit is not detrimental to the economy rather a necessity if the country wants to transition from an import-driven economy to an export-driven economy.
“Just like any other country, Ghana borrows because it wants to inject resources into the economy with the expectation that it will enhance productivity,” he said.
IMF and the World Bank earlier this week, classified Ghana as being closer to a high debt distressed country, and expressed worry about the country’s inability to honour its debt obligations.
Reacting to the classification by the Fund and World Bank, Mr Ofori-Atta asserted that the classification by the two financial institution is not for Ghana to stop borrowing but rather borrow with care.
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“I think the issue is not that we should not borrow, we should borrow but we should do so with care,” he noted.
Ghana’s debt stock as at September 2019 was pegged at GH¢208.6 billion, equivalent to 60.3 percent of the country’s gross domestic product, data from the Bank of Ghana revealed.