An Economist, Dr. John Gatsi has said the current power crisis is a threat to Ghana’s debt sustainability.
[contextly_sidebar id=”3gdJa6pwRctrAtxRxFuitma4Itj0UhJc”]Ghana’s debt stock increased from GHC 51.9 billion in 2013 to GHC 71. 6 billion cedis in 2014 and from GHC 71.6 billion to GHC 88.2 billion cedis at the end of March 2015.
The Economist believes the debt stock might further increase in subsequent years if the power crisis is not resolved.
The government has been struggling to permanently fix the three-year energy crisis which has resulted in an intensified load shedding exercise.
The situation has led to massive job cuts, low productivity, high cost of doing business, among others.
On Thursday, the Institute of Statistical, Social and Economic Research (ISSER) revealed that Ghana loses over $2 million daily due to the ongoing power crisis.
The Head of the Economic Division at ISSER, Dr. Charles Ackah explained that the figure translates to about 2% of national output lost due to the energy crisis.
Dr. Gatsi told Citi News, the problem has a very high likelihood of negatively affecting the country’s Gross Domestic Product (GDP) level which will then affect debt management.
“If the projection that they [ISSER] have made is correct, it means that this will have a serious implication on the GDP that we are going to record at the end of the financial year and that will undermine the debt sustainability of the country because we basically relate the level of debt to GDP so if the growth of GDP is not much to accommodate the level of increasing debt it means that your debt sustainability will be under threat…” he explained.
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By: Marian Efe Ansah/citifmonline.com/Ghana