Ghana’s 2020/2022 debt crisis: Can Akufo-Addo administration be held solely responsible?
I have consistently explained the economic circumstances that culminated in Ghana’s debt crisis, which became particularly acute in 2020. Following substantial debt relief under the Highly Indebted Poor Countries (HIPC) Initiative, Ghana’s debt position improved considerably, becoming more sustainable from 2005 through 2013 before deteriorating again. Using the ECOWAS convergence criterion of a debt-to-GDP ratio of 70% as a benchmark, Ghana’s debt ratio exceeded this threshold in 2014, 2015 and 2016. The country subsequently recorded ratios below this benchmark in 2017, 2018 and 2019. The figures even became better after the rebasing in 2018! However, the COVID-19 pandemic and its associated economic disruptions significantly worsened the country’s fiscal position in 2020, contributing to a renewed and severe debt crisis.