Ghana’s debt concerns grow amid China’s $50 billion credit to Africa

There are increasing concerns that Ghana may become more indebted to China following Beijing’s announcement of an additional $50 billion in credits to Africa.

As China is already the largest bilateral creditor to Ghana, there are growing calls for the government to take immediate action to reduce the country’s dependence on Chinese loans.

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 maintains that China’s engagement with Ghana is driven purely by economic interests and not by the debt trap that critics have feared.

The Center emphasises that the goal is to find partners who understand Ghana’s development needs, are committed, and are willing to help address 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?”