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No govt should be permitted to borrow beyond 70% of GDP -Ex-Minority Leader

No govt should be permitted to borrow beyond 70% of GDP -Ex-Minority Leader

During a budget debate, Haruna Iddrisu, the Member of Parliament for Tamale South, proposed a significant change to government borrowing practices. He suggested capping government borrowing at 70% of GDP, a move that would impose a strict limit on the government’s ability to accumulate additional debt. Highlighting the importance of fiscal responsibility, Iddrisu stated, “No president or government should be allowed to exceed borrowing beyond 70% of GDP.”

In addition to this proposal, the former Minority Leader also called for a thorough examination of the Finance Ministry’s indebtedness to State Owned Enterprises (SOEs). Specifically, he identified Ghana Gas, ECG, and NCA as entities where significant debt may be held by the Ministry of Finance. He stressed the need for a forensic audit to uncover the exact amount of money held by the Ministry and whether any funds had been misappropriated by the office of the Chief of Staff.

This suggestion comes in light of Ghana’s rising public debt, which increased from 79.6% in 2021 to over 90% of GDP in 2022, according to the World Bank. The high debt-to-revenue ratio of 117.6% raises concerns about the country’s ability to meet its financial obligations and leaves it exposed to potential economic shocks.

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