The opposition National Democratic Congress (NDC) has charged the government to seek urgent debt relief from the International Monetary Fund (IMF) through the newly proposed Debt Relief Initiative.
This, it said, is because the current debt profile of the country makes it unsustainable and is putting severe pressure on the nation’s finances making it difficult to meet debt service deadlines while meeting other expenditure commitments at the same time.
Member of Parliament (MP) for Ajumako-Enyam-Essiam Constituency and Minority Ranking Member on the Finance Committee of Parliament, Cassiel Ato Forson, disclosed this at a Policy Dialogue held at the University of Professional Studies, Accra.
“The Akufo-Addo and Bawumia government must seek urgent debt relief from the International Monetary Fund through the newly proposed Debt Relief Initiative, known as the Common Framework for Debt Treatments Beyond the Debt Service Suspension Initiative, which can be likened to the HIPC Initiative,” Mr Forson said at the event attended by a cross-section of Minority MPs and some academics drawn from various universities in the capital.
He said available figures show that up to 87% of the government’s tax revenue went into debt servicing which is the payment of interest and amortisation alone leaving very little for investment in critical sectors of the economy.
This, he said, would worsen if the current borrowing situation continues into the foreseeable future.
“Failure by the Akufo-Addo and Bawumia government to do as recommended, within the next 18 months, would expose Ghana to a high risk of default on its debt service obligations which will plunge the country into much deeper economic crisis,” he said.