BY GRACE ZIGAH
The debt-service burden has fallen sharply, with the country now spending less than 20% of its revenue on servicing public debt, Finance Minister Dr Cassiel Ato Forson has announced.
The Finance Minister said the development represented a significant improvement from the period when debt servicing consumed about half of the government’s revenue, severely limiting the resources available for critical public investments.
Dr Forson explained that at the height of debt challenges, approximately 50% of government revenue was being used to meet debt-service obligations, leaving considerably fewer resources for sectors such as education, healthcare, roads and other essential infrastructure.
“At its peak, we were spending about 50 per cent of our revenue on debt servicing. This meant less money for schools, hospitals, roads and other infrastructure. That was unsustainable,” Dr Forson said.
According to him, the reduction to below 20% has created additional fiscal space for government to channel more resources into public infrastructure and social services that directly affect the living conditions of Ghanaians.
“Today, I am proud to say that we have made considerable progress. We are now spending less than 20 per cent of our revenue on servicing debt,” he stated.
The Finance Minister also indicated that the government was seeking to institutionalise fiscal discipline to prevent Ghana from returning to the debt pressures that previously constrained public spending.
He said measures were being taken to ensure that fiscal rules introduced by the government would be enshrined in law, making them binding on successive administrations.
“We are ensuring the fiscal rules we have instituted are enshrined in law, so that no matter which government is in office, these rules will be respected,” Dr Forson stated.
The move, he suggested, is intended to provide a stronger framework for fiscal management and prevent future governments from adopting policies that could once again push the country into an unsustainable debt position.
Dr Forson made the disclosure during the signing of an agreement between the Governments of Ghana and Belgium to restructure debt owed to Belgium’s export credit agency.
