Ghana can’t reapply for debt relief under HIPC – World Bank

The World Bank in response to claims that Ghana has been listed to receive one of the Bank’s debt relief programmes – the Highly Indebted Poor Countries Programme (HIPC) has said Ghana does not qualify to apply for the programme, having graduated in 2004.

In the last week there have been reports and information shared on social media platforms claiming that due to the country’s current debt situation, Ghana has been classified for HIPC. Some have also used a data system of the World Bank to make the point.

The Bank clarified the situation in a three-point note copied to ghanabusinessnews.com.

The list of HIPC countries includes all countries that have either qualified or are potentially eligible for debt relief under the HIPC Initiative, the Bank said.

The 39 countries that are included in the list, it added, are at different stages in the HIPC process:

1. 36 have graduated from and exited the HIPC process (these countries have benefitted from comprehensive HIPC Initiative debt relief from all external creditors on an irrevocable basis and from debt relief under the complementary Multilateral Debt Relief Initiative (MDRI) by IDA, the IMF and the AfDB);
2. One country (Somalia) has started the HIPC process but has still to fulfill the requirements to graduate from it; and iii) 2 countries (Eritrea and Sudan) are potentially eligible HIPCs and have yet to start the debt relief process.

“Ghana is among the countries that graduated from the HIPC process (it did so in 2004 by reaching the Initiative’s completion point). Countries graduating from the HIPC process cannot re-apply for debt relief under the HIPC Initiative,” the Bank said.

Ghana’s public debt has ballooned to over GH¢258 billion, above 70 per cent of GDP, and the country has been classified as in high risk of debt distress.