A Development Economist, Dr Frank Bannor, has the upward trend in Ghana’s public debt is not solely due to exchange rate depreciation.
Dr Bannor makes the point that it is questionable that in the era of “so-called” better management of the cedi, it would yield an increased public debt of Ghc71 billion.
The public sector debt has risen by more than GH¢70 billion in just three months.
Anosyst say this reflects pressures from the cedi’s sharp depreciation against the US dollar in the third quarter of 2025.
Ghana’s public debt increased by about GH¢71.6 billion in the third quarter, with projections indicating that total public debt could exceed GH¢700 billion by the end of the year if the cedi remains under sustained pressure against the dollar.
Total public debt, which declined by GH¢156.4 billion between the first and second quarters, has now risen to GH¢684.6 billion, heavily driven by the cedi’s renewed struggle against the US dollar in Q3.
Dr Bannor, also a Senior Research Fellow at the Institute of Economic Research and Public Policy (IERPP), in a statement reacting to this, said that “This public debt data of Ghc71 billion is questionable! I contend that the rise in public debt is not solely due to exchange rate depreciation! Why? Even in the year 2022 where we witnessed one of the worst performance of the cedi against the dollar, recall that Ghana’s debt stock increased by only 67 billion Ghana cedis ($7.9bn) as at the end 2022 due to the depreciation of the cedi.
“It is therefore questionable that in the era of so-called better management of the cedi it would yield an increased public debt of Ghc71 billion! What is the rate of depreciation in the 3rd quarter of 2025 compared to that of 2022? Someone is hiding behind this loose assumption to hide the true cause of the public debt crisis! High borrowing from the domestic market is a plausible factor!”
