Dr Gideon Boako, Member of Parliament for Tano South and spokesperson for former Vice President Dr Mahamudu Bawumia, has mounted a strong critique of
Dr Gideon Boako, Member of Parliament for Tano South and spokesperson for former Vice President Dr Mahamudu Bawumia, has mounted a strong critique of the government’s explanation for the recent sharp rise in the public debt, describing it as contradictory and economically unsound.
Reacting to the latest debt figures released by the Bank of Ghana, Dr Boako questioned claims by the Finance Ministry that exchange rate pressures are largely responsible for the more than GH¢71 billion increase in the public debt recorded within just three months.
The data show that the total public debt climbed by approximately GH¢71.6 billion in the third quarter of 2025 alone, pushing the stock to about GH¢684.6 billion and raising fears that it could exceed GH¢700 billion before the end of the year.
Dr Boako, who also serves as Deputy Ranking Member on Parliament’s Finance Committee, argued that the government’s position represents a clear inconsistency in its fiscal messaging.
Writing under the headline “Double-tongued Minister for Finance,” he accused the Finance Minister of shifting explanations depending on whether the figures are favourable or unfavourable.
According to him, the same exchange rate movements that were celebrated earlier in the year for reducing the debt stock are now being blamed for a dramatic increase.
“They were bragging that the stronger cedi helped to reduce the debt stock, so why this contradiction?” he asked, insisting that the explanation does not stand up to basic economic reasoning.
Boako stressed that currency appreciation, by definition, should not lead to an increase in debt when measured in local currency terms.
While he acknowledged that exchange rate movements can have indirect effects on debt servicing and valuations, he maintained that they cannot logically explain a sudden spike of over GH¢71 billion within a single quarter.
“I am still struggling to understand how appreciation causes debt to go up,” he stated, arguing that the government has failed to provide a coherent and transparent breakdown of the figures behind the latest debt increase.
To support his position, Dr Boako pointed to the exchange rates used in valuing the foreign-denominated debt.
He noted that at the end of 2024, foreign debt was calculated using an exchange rate of about GH¢14.3 to the US dollar, compared with the current rate of roughly GH¢11.4. Despite this relative strengthening of the cedi compared to last year, the debt stock has nonetheless increased, a development he said raises serious questions about the Finance Ministry’s narrative.
He further dismissed suggestions that the depreciation recorded over the past three months alone could account for the magnitude of the increase. In his view, the explanation reflects a poor grasp of debt dynamics and masks deeper issues in fiscal management.
Dr Boako’s critique comes against the backdrop of a fragile recovery earlier in 2025. In the first half of the year, Ghana recorded a significant reduction in public debt, with figures showing a drop of about GH¢156.4 billion between the first and second quarters.
That improvement was widely attributed by the government to a strong cedi and improved debt management.
During the 2025 Mid-Year Budget Review, Finance Minister Cassiel Ato Forson highlighted what he described as a positive trajectory, noting that public debt had declined from GH¢726.7 billion at the end of December 2024 to about GH¢613 billion by the end of June 2025. That optimism, however, has since been overtaken by events.
The third quarter of 2025 saw renewed pressure on the cedi, which lost about 24 per cent of its value after appreciating by more than 40 per cent in the previous quarter. Given Ghana’s high exposure to foreign-currency-denominated debt, such movements have historically had a significant impact on debt figures when converted into cedi terms.
Indeed, historical data show that exchange rate depreciation accounted for about 62.5 per cent of the increase in the public debt in 2023 alone, underscoring the economy’s vulnerability to currency shocks.
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