Member of Parliament for Cape Coast South, Kwaku Ricketts-Hagan, has stated that considering the debt levels of the country in the hands of the NPP-led administration, Ghana has reached the status of a Highly Indebted Poor Country (HIPC).
He said the country’s high debt levels has reached the HIPC status considering the technicalities involved in declaring that status.
Mr Ricketts-Hagan pointed out that the International Monetary Fund (IMF) has a report called the Article Four Consultation where they have predicted that by the end of the year, the country’s debt levels will increase to about 84% debt to Gross Domestic Product (GDP).
He said such a percentage in debt level will be very high for the structure of the Ghanaian economy to endure.
Mr Ricketts-Hagan pointed out that the country’s increasing borrowing presents a lot of problems to the country’s purse, especially servicing such debts.
He said it is not the gross domestic product(GDP) that is used to service the country’s debt even though we measure debt to GDP.
Mr Ricketts-Hagan said the country is crawling to a HIPC status because the government is using approximately 70% of the country’s revenues in servicing debts.
He made this pronouncement in an interview with Kwame Tutu on the 100 Degrees program on Onua TV, Monday, August 10.
He was speaking on the back of the Mid-year Budget presented to Parliament by the Finance Minister Ken Ofori-Atta and the promise of one million jobs in the country.
“We are already in a HIPC status but it’s only the technicalities. This IMF we are talking about, they have a report called the Article Four Consultation, in which they are predicting that by the end of the year, the country’s debt to GDP will reach about 84%, which will be way up for the structure of the country’s economy”, he pointed out on the 100 Degrees program.
Mr Ricketts-Hagan gave the analogy that if Ghana was a human who earns GHC100 at the end of every month, she would end using about GHC72 of that amount to service her accumulated debts over the years.