The claim by the Minister of Finance, Seth Terkper that Ghana’s debt to GDP ratio declined from 72 percent in 2015 to 63 percent at the end of May 2016 has been strongly challenged by the Vice Presidential Candidate of the opposition New Patriotic Party (NPP) Dr Mahamudu Bawumia.
Mr Terkper, in July, during the presentation of the 2016 supplementary budget told Parliament of the decline in the public debt and that Ghana’s economy was moving from a low-income status to a middle-income status
But speaking at his lecture on the economy on Thursday, Dr Bawumia said, “Interestingly, in the presentation of the supplementary budget in July 2016, the Minister of Finance stated that Ghana’s debt to GDP ratio had declined from 72% in 2015 to 63%. Unfortunately and sadly this is untrue”.
According to him, “the calculation of the debt to GDP ratio used by the Minister is just plain wrong and misleading” because “the government has taken the total debt stock in May 2016, and divided it by the projected GDP in December 2016, to arise at the debt to GDP ratio is 63%”.
“If you ask the Minister about how he achieved this dramatic reduction in the debt to GDP ratio in either January or May 2016, he will be unable to tell you. All that has happened is that, he has used a higher projected GDP number to do the calculation”, he added.