Ghana’s Finance Minister, Cassiel Ato Baah Forson, reported significant external debt service obligations totaling $8.7 billion over the next four years, with major payments due in 2027 and 2028. The country lacks financial buffers to manage this burden while emerging from a severe economic crisis amid rising costs and international debts.
Ghana’s Finance Minister, Cassiel Ato Baah Forson, announced that the nation is facing considerable external debt service obligations over the upcoming four years. According to his remarks delivered in parliament, Ghana is required to pay approximately $8.7 billion, which constitutes 10.9% of the country’s GDP. Notably, the bulk of these payments is concentrated in the years 2027 and 2028, with planned payments of $2.5 billion in 2027 and $2.4 billion in 2028.
Forson highlighted a significant concern regarding the absence of financial buffers to mitigate the burden of these domestic and external debt service obligations. He emphasized that these challenging circumstances arise amid Ghana’s recovery from its most severe economic crisis, exacerbated by the COVID-19 pandemic, the ongoing conflict in Ukraine, soaring global interest rates, and years of excessive borrowing.
President John Dramani Mahama, who assumed office in January, is confronted with the dual challenges of revitalizing the economy and addressing a cost-of-living crisis. His administration is currently under an International Monetary Fund bailout, following a sovereign debt default in the cocoa and gold-producing country, which further complicates the economic landscape.
In summary, Ghana is grappling with substantial external debt service obligations amounting to $8.7 billion over the next four years. The significant payments in 2027 and 2028 raise concerns about the lack of financial buffers to address these obligations effectively. As the nation works to recover from a deep economic crisis, President Mahama’s administration faces notable challenges, including a cost-of-living crisis and commitments to international financial assistance.
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