INTERNATIONAL DEVELOPMENT ASSOCIATION INTERNATIONAL MONETARY FUND GHANA Joint World Bank-IMF Debt Sustainability Analysis April 2020 Prepared Jointly by the staffs of the International Development Association (IDA) and the International Monetary Fund (IMF) Approved by Marcelo Estevão (IDA) and Mark Flanagan (IMF) Ghana: Joint Bank-Fund Debt Sustainability Analysis Risk of external debt distress High Overall risk of debt distress High Granularity in the risk rating Sustainable Application of judgement No 1. External and overall debt are at high risk of debt distress but remain sustainable. The shocks from COVID-19 epidemic (collapse of oil prices, decline in trade, and lower non-commodity growth) are expected to deepen current account and fiscal deficits over the medium term resulting in a higher debt path compared to the November 2019 DSA. 2. The end of exceptional spending items (COVID-19-related spending, financial sector restructuring) and the government’s commitment to the fiscal rule underpin the downward path of debt from 2022. Ghana enters the crisis relatively well prepared. External buffers have been strengthened with better-than-expected outturn in 2019 due to higher gold export receipts and remittances, and a $3bn Eurobond issue in early 2020. Contingent risks have been alleviated thanks to progress on the financial sector clean-up and the launch of the energy sector reform program. Gold prices (Ghana’s main export) boosted by the global flight to safety and the pre- sale of most of 2020 cocoa harvest mitigate the impact of the shock this year. 3. The standard stress tests have been augmented to reflect a possible scenario with a stronger outbreak and protracted national lockdown. Growth shock has been increased to two standard deviations and exchange rate depreciation has been increased to 40 percent. Under these extreme shocks, debt still remains sustainable. Debt-service indicators are not on an explosive path. Furthermore, the DSA shocks likely exaggerate the impact on these indicators over the medium-long run given that, once the COVID emergency is solved and the elections are over, stressors such as risk premia, low commodity prices, and weak domestic revenues would improve significantly. 4. Nevertheless, even under the baseline, risks to the outlook remain important. Risks depend primarily on the depth and duration of the COVID-19 and oil price shock. Fiscal costs including pandemic response and measures to support economic activity could exceed those envisioned in the baseline and extend into 2021. A deeper global slowdown could have a greater impact on oil prices, private transfers and investment and further weaken the exchange rate. A more prolonged crisis could create additional liquidity risks into 2021. Stress tests show that, of these risks, exchange rate depreciation, and export and commodity prices shocks might have the greatest impact on debt sustainability. 2 Table 1. Ghana: External Debt Sustainability Framework, Baseline Scenario, 2017-2040 (In percent of GDP, unless otherwise indicated) Actual Projections Average 8/ 2017 2018 2019 2020 2021 2022 2023 2024 2025 2030 2040 Historical Projections External debt (nominal) 1/ 43.8 45.4 47.0 56.0 54.7 53.9 52.6 51.9 51.4 43.1 35.4 35.3 50.4 Definition of external/domestic debt Residency-based of which: public and publicly guaranteed (PPG) 39.8 41.1 42.4 51.2 49.6 48.6 47.0 46.0 45.2 35.5 25.4 31.4 44.2 Is there a material difference between the Yes two criteria? Change in external debt 1.9 1.6 1.6 9.0 -1.3 -0.8 -1.4 -0.7 -0.5 -1.8 1.4 Identified net debt-creating flows -5.5 -6.2 -4.2 -0.2 -5.1 -3.5 -5.4 -4.4 -4.2 -4.3 -2.9 -2.3 -4.2 Non-interest current account deficit 1.3 0.8 0.3 1.7 -0.3 -0.2 -0.1 -0.6 -0.3 -1.1 -0.5 4.3 -0.4 Deficit in balance of goods and services 3.1 1.1 1.9 2.3 0.1 0.4 -1.2 -1.7 -1.5 -0.4 1.3 6.7 -0.6 Exports 34.6 34.4 34.5 34.1 35.2 34.3 34.4 33.5 32.3 27.0 18.4 Debt Accumulation Imports 37.7 35.4 36.4 36.4 35.3 34.7 33.3 31.8 30.8 26.6 19.8 6.0 10 Net current transfers (negative = inflow) -4.2 -3.9 -5.1 -3.3 -3.2 -3.1 -2.9 -2.8 -2.7 -2.2 -1.4 -4.2 -2.7 of which: official 0.0 0.0 0.0 2. Ghana:0.0 Table Public Sector 0.0 Debt Sustainability 0.0 0.0 Framework, 0.0 Baseline Scenario, 0.0 0.0 2017-2040 0.0 9 Other current account flows (negative = net inflow) 2.4 3.7 3.5 2.7 2.5 of GDP, 4.0 2.9 (In percent 4.0 indicated) unless otherwise 3.9 1.5 -0.5 1.9 2.9 5.0 8 Net FDI (negative = inflow) -5.5 -4.4 -4.9 -3.9 -5.0 -5.0 -5.0 -5.0 -5.0 -4.0 -3.0 -5.6 -4.8 Endogenous debt dynamics 2/ -1.3 Actual -2.5 0.3 2.0 0.1 1.8 -0.2 Projections 1.1 1.1 0.8 0.6 Average 6/ 7 4.0 Contribution from nominal interest rate 2.1 2.3 2.4 2.8 3.3 3.5 3.3 3.3 3.2 2.6 2.1 6 Contribution from real GDP growth -3.2 -2.5 -2.7 -0.7 -3.2 -1.7 -3.6 -2.2 -2.1 -1.8 -1.5 3.0 5 Contribution from price and exchange rate changes -0.2 2017 -2.4 2018 0.6 2019 … 2020 … 2021 … 2022 … 2023 … 2024 … 2025 … 2030 … 2040 Historical Projections Residual Public 3/ debt 1/ sector 7.457.6 7.8 62.5 5.863.5 9.2 73.3 3.9 71.2 2.7 71.0 4.0 69.6 3.7 3.7 69.3 69.0 2.5 51.7 4.3 4.4 30.7 3.8 48.5 65.3 4 2.0 Definition of external/domestic Residency- ofof which:external which: exceptional debtfinancing 0.039.8 0.0 41.1 0.042.4 0.0 51.2 0.0 49.6 0.0 48.6 0.0 47.0 0.0 0.0 46.0 45.2 0.0 35.5 0.0 25.4 31.4 44.2 3 debt based of which: local-currency denominated 2 Sustainability Change indicators in public sector debt 0.0 4.9 1.0 9.8 -2.1 -0.2 -1.4 -0.3 -0.2 -3.7 1.9 1.0 Is there a material difference PV of PPGdebt-creating Identified flows external debt-to-GDP ratio ... -2.6 0.7 ... 35.7 2.9 8.5 42.7 44.0-1.4 0.7 41.4 43.0 -0.540.9 0.4 40.4 0.5 31.6 -3.123.0 2.0 -0.4 -0.5 Yes 1 between the two criteria? Primary PV of PPGdeficit external debt-to-exports ratio ... -0.5 1.4 ... 103.5 1.8 4.1 125.4 125.1 0.0 125.4 -0.5120.2 -0.1 121.9 0.1 124.9 0.4 117.2 -2.8 124.7 2.2 2.1 -0.8 0.0 0 Revenue PPG and grants debt service-to-exports ratio 4.8 13.9 14.5 5.0 14.314.3 13.5 19.4 15.315.1 15.9 15.1 14.7 15.114.5 15.2 15.8 15.218.8 16.419.1 17.0 13.7 15.4 2020 2022 2024 2026 2028 2030 of which: grants 0.6 0.3 0.3 0.4 0.3 0.3 0.2 0.1 0.1 0.0 0.0 Public sector debt 1/ PPG debt service-to-revenue ratio 12.4 12.0 35.0 50.2 36.5 36.9 34.0 32.3 33.5 30.9 20.7 Primary (noninterest) expenditure 13.4 15.9 16.1 17.7 15.1 14.6 15.0 15.3 15.6 13.6 19.2 15.8 14.6 Gross external financing need (Million of U.S. dollars) -965.0 -590.3 977.2 3602.4 893.2 1102.1 976.7 610.1 1122.1 2177.6 5734.9 Rate of Debt Accumulation Automatic debt dynamics -2.0 -0.1 1.2 4.3 -1.4 1.2 -0.4 0.3 0.1 -0.3 -0.2 of which: local-currency denominated Contribution from interest rate/growth differential -1.1 -0.5 -1.2 1.3 -0.8 1.5 -1.0 0.5 0.2 -0.2 -0.2 Grant-equivalent financing (% of GDP) Key macroeconomic assumptions of which: foreign-currency denominated of which: contribution from average real interest rate 3.2 2.8 2.4 2.2 3.3 3.8 3.8 3.4 3.1 2.1 1.1 Grant element of new borrowing (% right scale) Real GDP growth (in percent) 8.1 6.3 6.1 1.5 5.9 3.3 7.1 4.4 4.3 4.3 4.7 6.7 4.2 of which: contribution from real GDP growth -4.3 -3.4 -3.6 -0.9 -4.1 -2.3 -4.7 -2.9 -2.8 -2.3 -1.3 80 GDP deflator in US dollar terms (change in percent) -0.8 4.5 -3.3 -5.9 -2.3 2.5 1.3 1.6 2.3 2.3 2.1 0.8 1.1 Contribution from real exchange rate depreciation -0.9 0.4 2.4 ... ... ... ... ... ... ... ... 70 Effective interest rate Other identified (percent) 4/ flows debt-creating 5.4 0.0 5.9 -0.5 5.5 0.0 5.6 0.0 6.1 0.0 6.7 0.0 6.7 0.0 6.6 6.6 0.0 0.0 6.2 0.0 6.5 4.3 0.0 6.4 0.1 0.0 External debt (nominal) 1/ 60 Growth of exportsreceipts Privatization of G&S (negative) (US dollar terms, in percent) 17.0 0.0 10.2 -0.5 10.2 0.0 -5.6 0.0 6.8 0.0 3.3 0.0 8.9 0.0 3.3 2.8 0.0 0.0 2.7 0.0 4.2 13.6 0.0 3.1 of which: Private 50 Growth of imports Recognition ofof G&S (US dollar contingent terms, liabilities in bank (e.g., percent) recapitalization) 8.4 0.0 4.3 0.0 5.3 0.0 -4.5 0.0 0.3 0.0 4.3 0.0 3.9 0.0 1.4 3.5 0.0 0.0 3.6 0.0 4.9 9.2 0.0 2.4 60 40 Grant element Debt reliefof public new and (HIPC sector borrowing (in percent) other) ... 0.0 ... 0.0 ... 0.0 5.2 0.0 2.4 0.0 8.6 0.0 3.3 0.0 5.0 2.5 0.0 0.0 4.6 0.0 0.0 ... 0.0 4.2 Government revenues (excluding grants, in percent of GDP) 13.3 0.0 14.2 14.1 0.0 13.2 14.8 0.0 14.8 30 Other debt creating or reducing flow (please specify) 0.0 0.0 0.0 14.9 0.0 15.1 15.2 0.0 0.0 16.4 0.0 17.0 12.9 0.0 15.2 50 Aid flows (in Million of US dollars) 5/ 352.7 180.3 191.0 394.9 446.3 930.5 462.4 535.7 341.3 567.2 2.1 20 Residual 2.5 4.1 -1.9 4.3 -1.3 -1.2 -0.4 -0.9 -0.8 -0.6 -0.1 3.5 -0.4 Grant-equivalent financing (in percent of GDP) 6/ ... ... ... 1.0 0.5 0.7 0.4 0.3 0.2 0.2 0.0 ... 0.4 10 40 Grant-equivalent Sustainability financing (in percent of external financing) 6/ indicators ... ... ... 8.3 8.0 13.7 7.7 7.0 3.9 5.1 0.0 ... 6.5 0 Nominal PV GDPdebt-to-GDP of public (Million of USratio dollars) 2/ 58,978 ... 65,518 ... 67,240 59.3 64,183 68.3 66,36166.6 70,316 66.4 76,300 80,900 65.2 86,320 65.0 119,006 65.0 230,456 48.4 28.8 2020 2022 2024 2026 2028 2030 PV of public Nominal debt-to-revenue dollar GDP growth and grants ratio … 7.3 … 11.1 413.6 2.6 504.3 -4.5 440.8 3.4 6.0440.9 8.5 432.1 6.0 428.3 6.7 426.1 6.7 295.3 6.9 169.4 7.7 5.4 30 Debt service-to-revenue and grants ratio 3/ 100.8 68.4 91.7 106.8 79.4 72.7 79.8 81.2 76.1 61.2 33.0 Gross financing need Memorandum 4/ items: 13.5 10.8 14.9 18.6 12.0 10.5 12.0 12.4 12.0 7.2 7.8 20 of which: held by residents PV of external debt 7/ ... ... 40.2 47.5 49.1 48.4 47.0 46.8 46.5 39.1 33.0 of which: held by non-residents Key macroeconomic and fiscal assumptions In percent of exports ... ... 116.7 139.5 139.6 141.0 136.5 139.5 144.0 145.2 178.9 10 80 Real GDP growth (in percent) 8.1 6.3 6.1 1.5 5.9 3.3 7.1 4.4 4.3 4.3 4.7 6.7 4.2 Total external debt service-to-exports ratio 7.5 5.8 8.0 17.5 5.8 22.9 18.9 6.8 19.7 70 Average nominal interest rate on external debt (in percent) 6.1 6.1 7.1 18.7 7.0 18.8 20.4 7.0 6.9 25.6 6.6 32.4 7.2 4.4 6.7 PV of PPG external debt 60 Average real interest rate(in on Million domesticof US dollars) debt (in percent) 8.8 7.1 23982.4 4.1 27,403.651.3 29204.7 4.530246.6 31571.0 6.3 33078.4 6.6 34841.3 5.3 37588.4 4.3 53007.1 3.3 2.3 7.6 0 4.2 (PVt-PVt-1)/GDPt-1 (in percent) 5.1 … 2.8 ... 1.6 1.9 2.0 2.2 0.2 3.1 50 Real exchange rate depreciation (in percent, + indicates depreciation) -2.9 1.5 7.3 ... ... ... ... ... ... 2.5 ... 2020 2022 2024 2026 2028 2030 Non-interest current account 40 Inflation rate (GDP deflator, indeficit percent)that stabilizes debt ratio -0.6 10.4 -0.8 10.2 -1.3 8.8 -7.3 9.3 1.0 8.3 0.6 7.3 1.2 6.4 0.1 0.2 6.5 6.4 0.7 6.3 -1.9 6.1 14.1 7.0 30 Growth of real primary spending (deflated by GDP deflator, in percent) -5.4 25.8 7.8 11.4 -9.4 -0.3 10.2 6.1 6.8 5.6 6.5 8.7 2.9 20 Country Sources:deficit Primary authorities; that anddebt-to-GDP stabilizes the staff estimates and5/ projections. ratio -0.5 -3.5 0.8 -5.6 2.1 -0.3 1.3 0.4 0.6 0.9 0.3 -1.1 0.3 PV of contingent liabilities (not included in public sector debt) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 10 1/ Includes both public and private sector external debt. 0 2020 2022 2024 2026 2028 2030 2/ Derived as [r - g - ρ(1+g) + Ɛα (1+r)]/(1+g+ρ+gρ) times previous period debt ratio, with r = nominal interest rate; g = real GDP growth rate, ρ = growth rate of GDP deflator in U.S. dollar terms, Ɛ=nominal appreciation of the local currency, and α= share of local currency-denominated external debt in total external debt. Sources: Country authorities; and staff estimates and projections. 3/ Includes exceptional financing (i.e., changes in arrears and debt relief); changes in gross foreign assets; and valuation adjustments. For projections also includes contribution from price and exchange rate changes. 1/ Coverage of debt: The central government, central bank, government-guaranteed debt. Definition of external debt is Residency-based. 4/ The 2/ Current-year interest underlying payments PV of external divided by previous debt-to-GDP period ratio under debt stock. the public DSA differs from the external DSA with the size of differences depending on exchange rates projections. Defined 5/ Debt 3/ as grants, service concessional is defined loans, as the sum and debt of interest andrelief. amortization of medium and long-term, and short-term debt. Grant-equivalent 6/ Gross 4/ financing financing need includes is defined grants as the provided primary directly deficit plus debtto the government service and of plus the stock through new borrowing short-term debt at the(difference end of the between the last period face and value other and creating/reducing the PV of new debt). debt flows. Assumes 7/ Defined 5/ that as PV of private a primary deficit sector minus debt is equivalent a change to its in the public face value. ratio ((-): a primary surplus), which would stabilizes the debt ratio only in the year in question. debt-to-GDP 8/ Historical 6/ averages are Historical averages are generally derived over generally derived the past over the past 10 years, subject subject to 10 years, data availability, to data availability, whereas projections averages averages are whereas projections over the are over the first year of first year of projection and the projection and the next 10 years. next 10 years. 3 Figure 1. Ghana: Indicators of Public and Publicly Guaranteed External Debt under Alternatives Scenarios, 2020-2030 PV of debt-to GDP ratio PV of debt-to-exports ratio 80 300 70 250 60 200 50 40 150 30 100 20 50 10 Most extreme shock is One-time depreciation Most extreme shock is Exports 0 0 2020 2022 2024 2026 2028 2030 2020 2022 2024 2026 2028 2030 Debt service-to-exports ratio Debt service-to-revenue ratio 35 70 30 60 25 50 20 40 15 30 10 20 5 10 Most extreme shock is Exports Most extreme shock is One-time depreciation 0 0 2020 2022 2024 2026 2028 2030 2020 2022 2024 2026 2028 2030 Baseline Historical scenario Most extreme shock 1/ Threshold Customization of Default Settings Borrowing Assumptions for Stress Tests* Size Interactions Default User defined Shares of marginal debt Standardized Tests Yes Yes External PPG MLT debt 100% Tailored Tests Terms of marginal debt Combined CLs Yes Avg. nominal interest rate on new borrowing in USD 8.5% 7.5% Natural Disasters n.a. n.a. USD Discount rate 5.0% 5.0% Commodity Prices 2/ No No Avg. maturity (incl. grace period) 12 20 Market Financing No No Avg. grace period 6 17 Note: "Yes" indicates any change to the size or * Note: All the additional financing needs generated by the shocks under the stress tests are interactions of the default settings for the stress tests. assumed to be covered by PPG external MLT debt in the external DSA. Default terms of marginal "n.a." indicates that the stress test does not apply. debt are based on baseline 10-year projections. Sources: Country authorities; and staff estimates and projections. 1/ The most extreme stress test is the test that yields the highest ratio in or before 2030. Stress tests with one-off breaches are also presented (if any), while these one- off breaches are deemed away for mechanical signals. When a stress test with a one-off breach happens to be the most exterme shock even after disregarding the one- off breach, only that stress test (with a one-off breach) would be presented. 2/ The magnitude of shocks used for the commodity price shock stress test are based on the commodity prices outlook prepared by the IMF research department. 4 Figure 2. Ghana: Indicators of Public Debt Under Alternative Scenarios, 2020-2030 PV of Debt-to-GDP Ratio 120 100 80 60 40 Most extreme shock is One-time depreciation 20 0 2020 2022 2024 2026 2028 2030 PV of Debt-to-Revenue Ratio Debt Service-to-Revenue Ratio 700 140 600 120 500 100 400 80 300 60 200 40 100 Most extreme shock is Commodity price 20 Most extreme shock is One-time depreciation 0 0 2020 2022 2024 2026 2028 2030 2020 2022 2024 2026 2028 2030 Baseline Most extreme shock 1/ Public debt benchmark Historical scenario Borrowing Assumptions for Stress Tests* Default User defined Shares of marginal debt External PPG medium and long-term 44% 44% Domestic medium and long-term 36% 36% Domestic short-term 20% 20% Terms of marginal debt External MLT debt Avg. nominal interest rate on new borrowing in USD 8.5% 8.0% Avg. maturity (incl. grace period) 12 20 Avg. grace period 6 17 Domestic MLT debt Avg. real interest rate on new borrowing 4.1% 4.0% Avg. maturity (incl. grace period) 5 7 Avg. grace period 4 6 Domestic short-term debt Avg. real interest rate 1.4% 2.0% * Note: The public DSA allows for domestic financing to cover the additional financing needs generated by the shocks under the stress tests in the public DSA. Default terms of marginal debt are based on baseline 10-year projections. Sources: Country authorities; and staff estimates and projections. 1/ The most extreme stress test is the test that yields the highest ratio in or before 2030. The stress test with a one-off breach is also presented (if any), while the one-off breach is deemed away for mechanical signals. When a stress test with a one-off breach happens to be the most exterme shock even after disregarding the one-off breach, only that stress test (with a one-off breach) would be presented. 5 Table 3. Ghana: Sensitivity Analysis for Key Indicators of Public and Publicly Guaranteed External Debt, 2020-2030 (In percent) Projections 1/ 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 PV of debt-to GDP ratio Baseline 43 44 43 41 41 40 39 37 36 33 32 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 43 46 48 51 54 57 60 62 64 67 68 0 #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A B. Bound Tests B1. Real GDP growth 43 47 49 47 47 46 45 43 41 38 36 B2. Primary balance 43 46 49 48 47 47 46 44 42 41 39 B3. Exports 43 50 59 57 57 56 55 53 51 49 47 B4. Other flows 3/ 43 46 46 44 44 43 42 40 39 37 35 B5. Depreciation 43 70 68 66 65 64 62 59 56 52 49 B6. Combination of B1-B5 43 49 51 49 49 48 47 45 43 41 39 C. Tailored Tests C1. Combined contingent liabilities 43 48 48 47 46 46 45 43 42 40 38 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 43 45 45 44 45 44 43 42 40 38 36 C4. Market Financing 43 49 48 47 46 46 44 42 40 37 35 Threshold 40 40 40 40 40 40 40 40 40 40 40 PV of debt-to-exports ratio Baseline 125 125 125 120 122 125 126 121 121 120 117 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 125 131 141 148 162 177 191 201 220 238 253 0 125 123 123 121 122 127 128 124 123 120 110 B. Bound Tests B1. Real GDP growth 125 125 125 120 122 125 126 121 121 120 117 B2. Primary balance 125 130 143 139 141 145 146 142 145 145 145 B3. Exports 125 169 247 238 243 250 253 247 252 252 252 B4. Other flows 3/ 125 130 135 129 131 134 135 131 132 131 129 B5. Depreciation 125 118 117 112 114 117 117 112 112 110 107 B6. Combination of B1-B5 125 145 138 158 161 165 167 162 164 162 161 C. Tailored Tests C1. Combined contingent liabilities 125 137 140 135 138 142 143 139 143 144 143 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 125 126 130 128 132 137 139 135 135 134 132 C4. Market Financing 125 125 126 121 123 126 127 122 121 119 116 Threshold 180 180 180 180 180 180 180 180 180 180 180 Debt service-to-exports ratio Baseline 19 15 16 15 15 16 17 19 19 18 19 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 19 15 16 16 16 18 20 23 24 24 26 0 19 15 15 14 14 16 17 20 19 18 19 B. Bound Tests B1. Real GDP growth 19 15 16 15 15 16 17 19 19 18 19 B2. Primary balance 19 15 16 16 16 17 18 21 20 19 21 B3. Exports 19 18 24 26 26 28 29 33 32 31 33 B4. Other flows 3/ 19 15 16 15 15 16 17 20 19 18 20 B5. Depreciation 19 15 15 14 14 15 16 19 18 17 18 B6. Combination of B1-B5 19 17 20 19 19 20 21 25 24 23 24 C. Tailored Tests C1. Combined contingent liabilities 19 15 17 16 16 17 18 21 20 19 21 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 19 15 16 15 16 17 18 21 20 19 21 C4. Market Financing 19 15 16 15 15 19 21 22 19 17 18 Threshold 15 15 15 15 15 15 15 15 15 15 15 Debt service-to-revenue ratio Baseline 50 36 37 34 32 34 33 38 34 31 31 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 50 35 37 36 36 39 40 45 43 41 43 0 50 35 35 34 32 34 34 39 35 31 31 B. Bound Tests B1. Real GDP growth 50 39 42 39 37 39 38 44 39 35 35 B2. Primary balance 50 36 38 37 36 37 36 41 37 34 34 B3. Exports 50 36 40 41 40 41 41 45 41 37 38 B4. Other flows 3/ 50 36 38 35 34 35 35 39 36 32 32 B5. Depreciation 50 62 60 55 53 55 54 62 56 50 50 B6. Combination of B1-B5 50 38 42 39 37 39 38 43 39 35 36 C. Tailored Tests C1. Combined contingent liabilities 50 36 39 36 35 36 36 41 37 34 34 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 50 45 47 44 40 40 38 42 38 34 34 C4. Market Financing 50 36 38 35 34 41 42 42 36 29 29 Threshold 18 18 18 18 18 18 18 18 18 18 18 Sources: Country authorities; and staff estimates and projections. 1/ A bold value indicates a breach of the threshold. 2/ Variables include real GDP growth, GDP deflator (in U.S. dollar terms), non-interest current account in percent of GDP, and non-debt creating flows. 3/ Includes official and private transfers and FDI. 6 Table 4. Ghana: Sensitivity Analysis for Key Indicators of Public Debt , 2020-2030 in percent Projections 1/ 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 PV of Debt-to-GDP Ratio Baseline 68 67 66 65 65 65 62 59 56 52 48 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 68 65 61 58 55 52 49 47 44 42 41 0 #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A #N/A B. Bound Tests B1. Real GDP growth 68 72 79 80 82 84 83 82 81 79 78 B2. Primary balance 68 70 77 75 75 75 72 69 66 62 59 B3. Exports 68 72 83 81 81 81 78 75 72 68 65 B4. Other flows 3/ 68 68 70 68 68 68 65 62 59 55 52 B5. Depreciation 68 95 95 94 94 95 94 93 91 90 89 B6. Combination of B1-B5 68 72 78 77 78 80 78 76 74 71 69 C. Tailored Tests C1. Combined contingent liabilities 68 76 76 74 74 74 71 68 65 62 58 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 68 71 76 81 85 90 90 89 88 86 85 C4. Market Financing 68 67 66 65 65 65 62 59 56 52 48 Public debt benchmark 55 55 55 55 55 55 55 55 55 55 55 PV of Debt-to-Revenue Ratio Baseline 504 441 441 432 428 426 400 373 347 320 295 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 504 429 407 388 365 343 319 296 278 261 248 0 107 49 44 49 49 47 47 62 53 47 48 B. Bound Tests B1. Real GDP growth 504 477 524 529 539 552 536 519 505 488 475 B2. Primary balance 504 466 509 499 494 492 465 437 412 385 360 B3. Exports 504 479 550 540 535 532 504 475 448 419 394 B4. Other flows 3/ 504 451 462 453 449 447 420 393 367 339 314 B5. Depreciation 504 627 628 621 621 626 606 586 571 555 543 B6. Combination of B1-B5 504 475 514 513 517 523 502 481 461 440 422 C. Tailored Tests C1. Combined contingent liabilities 504 503 502 493 488 487 460 432 407 380 356 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 504 573 616 649 648 644 604 561 547 531 518 C4. Market Financing 504 441 442 434 431 429 403 374 347 319 293 Debt Service-to-Revenue Ratio Baseline 107 79 73 80 81 76 76 85 74 63 61 A. Alternative Scenarios A1. Key variables at their historical averages in 2020-2030 2/ 107 75 63 66 62 54 50 54 45 38 36 0 107 49 44 49 49 47 47 62 53 47 48 B. Bound Tests B1. Real GDP growth 107 85 85 96 100 95 96 109 99 88 89 B2. Primary balance 107 79 80 92 89 83 83 92 85 76 71 B3. Exports 107 79 75 87 89 83 83 93 81 69 68 B4. Other flows 3/ 107 79 73 81 83 77 77 87 76 64 63 B5. Depreciation 107 90 97 107 110 109 111 126 118 109 111 B6. Combination of B1-B5 107 82 80 94 95 90 90 101 90 82 80 C. Tailored Tests C1. Combined contingent liabilities 107 79 89 88 88 82 82 92 90 73 69 C2. Natural disaster n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. C3. Commodity price 107 98 99 114 115 107 103 109 102 94 94 C4. Market Financing 107 79 73 81 82 83 84 90 76 61 60 Sources: Country authorities; and staff estimates and projections. 1/ A bold value indicates a breach of the benchmark. 2/ Variables include real GDP growth, GDP deflator and primary deficit in percent of GDP. 3/ Includes official and private transfers and FDI. 7