Dr. Samuel Arkhurst, Director of Treasury and Debt Management Division at the Finance Ministry, provided insight into Ghana’s debt situation and the impact of recent debt restructuring efforts at the inaugural Quarterly Economic Roundtable event.
Pre-restructuring, the aggregate interest rate on central government debt was 19% (21% including other factors), consuming 21% of the country’s revenue for debt servicing. However, the restructuring program reduced this burden significantly to 9.1%.
Dr. Arkhurst illustrated the long-term benefits, citing a 10-year period where the cumulative interest payment would have equaled 100% of GDP at 20% interest, but now stands substantially lower.
While acknowledging the unintended consequence of frozen access to international capital markets and illiquid domestic bonds, Dr. Arkhurst assured that the current high interest rates on treasury bills are temporary and will reset quarterly based on market conditions.
He encouraged investors to view this as a short-term phenomenon and remain confident in Ghana’s long-term stability.
The Quarterly Economic Roundtable, themed “Restoring Macroeconomic Stability,” brought together experts to discuss debt, fiscal, and monetary policies, focusing on strategies to stabilize the cedi and ensure sustainable economic growth.
