Ghana Spent Nearly Half of Revenue on Debt Servicing Over Five Years

Ghana allocated 42% of its revenue to servicing debt between 2017 and 2022, according to the 2024 United Nations report on “Unpacking Africa’s Debt.” This represents a significant increase from the 2010–2016 period when the country spent 27% of its revenue on debt servicing.

The 15-percentage-point rise in debt servicing over the five-year period highlights the mounting fiscal pressures Ghana faced during this time.

Data from the Ministry of Finance reveals a sharp rise in interest payments. While GH¢36 billion was spent on debt servicing from 2010 to 2016, this amount surged to GH¢152 billion during the 2017–2022 period. In total, Ghana spent GH¢189 billion on debt servicing between 2010 and 2022, with 81% of this amount paid during the latter five years.

The Ministry of Finance’s data also shows that the country recorded its lowest interest payment in 2010 at GH¢1.44 billion, while the highest was in 2022 at GH¢45.69 billion.

The 2024 United Nations report pointed out that the rapid increase in debt servicing severely constrained government spending on public services. This pressure eventually led to Ghana being classified among the world’s 10 most debt-distressed nations.

In 2020, the International Monetary Fund (IMF) reported that Ghana’s debt-to-revenue ratio peaked at 127%, the highest in Sub-Saharan Africa at the time.

Although the ratio dropped to 117% in 2022, Ghana had to default on its external debts that year, followed by the restructuring of both domestic and foreign debt.