AGI bemoans Ghana’s increasing debt stock

Increasing debt rate poses a threat to local businesses

AGI praises government for review of benchmark value policy

Private sector the main driver of job creation, AGI

Ghana’s debt stock hit GH¢341.8 billion in September, translating to 77.8% of GDP. This, according to Ghanaians, is alarming, especially for business owners.

CEO of the Association of Ghana Industries, Seth Twum Akwaboah, has lamented the possible threats Ghana’s increasing debt has on local businesses.

“The other aspect that businesses are always concerned about is the micro economic stability because for businesses you need to have a predictable business environment so you can plan and invest and you know when you invest you’ll be able to recover your investment and I think we see signs of it in this budget.” He stated.

Speaking at KPMG's 2022 post budget forum, Mr Akwaboah said the increasing debt rate will deprive local businesses access to credit facilities from banks since they would have to compete with government.

He noted that “The problem that businesses have had is the level of debt stock that we have, how sustainable it is going to be financed and how we will be able to sustain it. Because normally when you finance the debt through local borrowing, you compete with local industries and businesses and normally government is stronger, so you crowd out local businesses access to bank borrowing.”

AGI praised government for reviewing the benchmark value policy.

“When this benchmark value was introduced, we raised issues about it and from day one our position has been clear that this is not a policy that was going to help local industries and we thought it should be selective. We should take products that we have local capacity to produce and exempt them from any benchmark value reduction and this is exactly what the government has done in the budget and we want them to stand by their position because it is important.”

Seth Twum Akwaboah was however not impressed with the implementation of policies that are brought up.

He stressed the role of the private sector in job creation.

“We believe that the private sector is actually the source of job creation, so If we are devoting the whole budget to building a sustainable entrepreneurial nation, then that is in order” he explained.