Ghana's debt woes deepen as China offers $50b credit to Africa

Accra, Ghana - September 10, 2024 - Ghana's growing reliance on Chinese loans has sparked concerns amid Beijing's announcement of an additional $50 billion in credits to Africa.

As China's largest bilateral creditor to Ghana, calls are mounting for the government to reduce the country's dependence on Chinese financing.

President Akufo-Addo recently praised the Ghana-China relationship, citing a 60-year history of diplomatic ties and China's role as a "reliable friend."

Speaking at the 2024 Forum on China-Africa Cooperation, President Akufo-Addo said, “We also value our relationship with China very much. Our relationship with China has been strong for over 60 years. In fact, I think we are one of the first countries in Africa to establish diplomatic relations with China, and ever since then, we have counted on you as one of our most reliable friends.”

However, the China-Africa Center argues that China's engagement with Ghana is driven by economic interests, not a "debt trap."

The Center emphasizes the need for Ghana to find partners who understand its development needs and are committed to addressing the nation's challenges. 

“If we find that, in these situations, China can play a part, then why not engage China to build those kinds of projects? So, there is no iota of truth to the debt trap theory. In fact, in the Ghana example, when you look at our total external debt as of 2022, which is about $30 billion, China’s share is about $1.9 billion, or about 6 per cent. So, if China owns about 6 per cent of our total external debt, how then can we conclude that this 6 per cent is the reason for our debt and that China is the cause of it?”

As Ghana navigates its financial relationship with China, concerns about indebtedness and economic sovereignty continue to grow.

Source : Lead News Online