The Technical Economic Advisor to Vice President, Dr Mahamudu Bawumia, has dispelled suggestions that the rate of borrowing under the current administration could plunge the economy into an irreparable national debt situation.
Dr Gideon Boako says the Minority’s argument that the rate of borrowing under the current administration points to at least an excess of GH¢140 billion in added national debt stock by 2020 is untenable in Economics sense.
Minority MP for Cape Coast South and a former Deputy Finance Minister, Kweku Ricketts-Hagan, said recently that if the current borrowing pattern under the Nana Akufo-Addo’s administration continues, Ghana’s debt stock in 2020 will exceed 2016 figures by at least GH¢18 billion.
He said that Ghana’s current debt stock of GH¢122.6 billion has jumped GH¢137 billion in just six months because of the growing appetite of the current administration to borrow.
However speaking on UP Front, a current affairs programme on Multi TV on Wednesday, Dr Boako said the gloomy prediction is nothing but a mere political rhetoric.
“I have listened to people’s arguments, especially my colleagues in the Minority, that this government has increased our debt stock from 122 billion to 137 billion, so it means on average every month they have been borrowing 5 billion. That is not the best of economics,” he said.
He said factors such as exchange rate figures and interest rate payments are key in determining debt figures and urged the Minority MPs to include that in their analysis.
“They [Minority MPs] understand it [factors that determine debt figures] but they are just trying to do that because of politics.
“You can sit down without borrowing, but your debt-stock will still increase in nominal terms,” he said to buttress his arguments on how interest rates, for instance, can change the debt figures.
He, however, wants the Minority to keep the government on its toes on proper management of the economy, albeit with sound economics reasoning.