Togbe Afede XIV, the Paramount Chief of the Asogli State, has reiterated his claim that Ghana is currently the most indebted country in Africa.
He first made this assertion in an article titled “Bank of Ghana Has Failed Us,” published in December 2022.
Togbe Afede XIV expressed concern at the fact that despite accumulating so much debt, Ghana still lacks basic infrastructure such as good roads, hospitals, and schools.
He also pointed out that the most indebted country is burdened by massive judgment debts resulting from greed and recklessness, which are hindering its development.
Africa’s total external debt, according to Dr Hippolyte Fofack, Chief Economist and Director of Research at Afreximbank, is estimated to be about $726 billion.
That makes it less than a third of Italy’s debt estimated at $2.8 trillion. When expressed as a percentage of GDP, Africa’s total external debt is 27%, compared to 130% in Europe.
Ghana’s public debt reached an unprecedented high surging to GH¢569.3 billion in April 2023, equivalent to a staggering 71.1% of Gross Domestic Product (GDP). Measured in dollar terms, Ghana’s debt stock stood at a substantial $52 billion.
The domestic debt also surged to GH¢247.9 billion by the end of April 2023, comprising approximately 30.9% of GDP. This represented a notable shift from the GH¢232.3 billion figure reported in December 2022, which accounted for around 38.1% of GDP.
At the moment, Ghana is in talks with its external creditors to restructure some $20bn of its $29bn external debts.
Ghana’s bilateral lenders, including the governments of China and France who co-chair the Official Creditor Committee (OCC), are scheduled to meet the Finance Minister on Monday, January 8, 2024, to discuss restructuring some $5.4 billion in loans to the country.
The country is also in talks with overseas bondholders to restructure its more than $13 billion in international debt. Holders of the bonds include major global asset managers such as BlackRock, PIMCO, Vontobel, AllianceBernstein and Neuberger Berman.