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Out of HIPC, into HIPC, Out of HIPC. Critical News, 12th October 2014

Posted by Business in Ghana on October 12, 2014

Sydney Casely-Hayford, sydney@bizghana.com

What a crazy week. And next week threatens to be even better. Is this good crazy or strange crazy? Can crazy get better or does it just mesmerize because we don’t understand the implications of future crazy?

A Deputy Director of Fiscal Affairs Department at the IMF, Sanjeev Gupta countered a Government statistic and declared us HIPC in one single response to a questioner and for a few brief days until the IMF chickened out and did some damage control we were back to HIPC, with a debt to GDP ratio pitched at 71%. Government had calculated its figure at 55%.

Now the program sensitive bureaucrats at the IMF have placed the figure at 56% and rephrased Gupta’s glib remark as their estimate for the end of 2015. Read the detail from here. (http://www.citifmonline.com/2014/10/11/imf-exonerates-govt-over-debt-to-gdp-controversy/)

This controversy has mega spine implications for the people at the IMF. Without providing numbers to show how he arrived at his 71% ratio, which I will try and justify or refute later in this article, I kind of accepted the figure, based on available statistics and the state of events in the country.

I do however think it is time to get clear reference points when we place these numbers in the public domain, especially when they can be alarming and even cataclysmic.

But as an aside, I wonder if Gupta will be sent to another division. Read the rest of this entry »

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