According to the International Monetary Fund Fiscal Monitor, Ghana will likely soon become a Highly-Indebted-Poor-Country (HIPC) country.
Countries that reach the 70% mark for debt-to-GDP ratio are classified as HIPC, which is an indicator that a country is in a poor financial position and is unable to pay its debts on time.
Reports earlier this year indicated that Ghana was soon to be classified as a high-risk debt distress country due to its high debt portfolio.
The country was already at a 67.3 percent debt-to-GDP ratio earlier in March this year, owing GH¢88 billion, an equivalent of over $20 billion USD.
The IMF’s Communication Director, Gerry Rice, in comments on Ghana stated “For countries at high-risk distress like Ghana, reducing the debt burden and associated vulnerability is a priority so the authorities have to be very selective with regards to new non-concessional borrowing since that can escalate.
“So fund policies are flexible, they can accommodate some non-concessional borrowing if indeed it is intended to finance critical and profitable projects for which concession finances are not available,” he added.
However, Ghana’s Deputy Finance Minister, Mona Quartey, has seemingly remained oblivious of the economic warnings and has said, “We are not going to HIPC”.
She also called for Ghanaians to “declare and decree” positive confessions.