Expert Calls for Debt Ceiling and Responsible Borrowing by Government

Professor Peter Quartey, Executive Director of the Institute for Statistical, Social and Economic Research (ISSER), has urged the Government to establish a debt ceiling as a ratio of gross domestic product (GDP) to ensure sustainable borrowing.

Speaking at the Quarterly Economic Roundtable, Prof Quartey recommended that the Government set an optimal debt level, beyond which it will not borrow, citing IMF and ECOWAS proposals of 50% and 75% of GDP, respectively.

He emphasized the need for responsible borrowing, involving prudent investment and repayment of borrowed funds, akin to a private sector mindset. This includes appraisal and evaluation reports to ensure effective utilization of borrowed funds.

Ghana’s debt stock, previously over 100% of GDP, is projected to fall to 55% by 2028 following debt restructuring and fiscal consolidation measures outlined in the IMF’s $3bn ECF programme.