MINISTER SAYS GOV’T INCURRING HIGH DEBTS BECAUSE OF INVESTMENTS IN PRODUCTIVE SECTORS

Finance Minister Seedy Keita has defended The Gambia’s mounting debt stock saying taking loans is not in itself a problem but the country’s capacity to repay those loans is what matters.

The country’s debt stock was hovering below D50 billion when the Barrow took over in 2017 but it has since risen to D129.5 billion by the end of 2024.

Many economic analysts contended the high loans are hamstringing the government’s ability to prioritise social development programmes and people-centred investments since debt-servicing outpaces all other sectors with D11 billion allocations in 2025 and D13 billion for 2026.

Yesterday, lawmakers demand answers from Minister Keita on government’s plans to stem the rising debt which Janjangbureh representative, Omar Jammeh said is hampering developments in health, education and agriculture sectors.

In response the minister explained: “Debt service is the elephant in the room of our economic management. The debt stock has two elements; the foreign component which is about 60 per cent and the domestic component which is about 40 per cent. Yes, the debt has increased but the funds have been invested in productive sectors. We have the University of The Gambia Faraba Bantang Campus, it was funded through debt; we have the electricity expansion project, it was funded through debt; and the OIC roads which were also funded through debt. So as these developments are being implemented, the portfolio of our debt stock has increased.”

According to Minister Keita, the country’s debt to GDP was as high as 120 in 2016 but the government’s reform programmes have seen it reduced to around 70 per cent. 

He added that the government is “very mindful” of the loan interest expenses and it is only borrowing loans that have a 35 per cent grant component and also only borrowing long-term loans. “But the most important thing is to increase our capacity to service those debts. We are increasing our revenue mobilisation because as the economy grows, your revenue should go up and your ability to service the debt should also grow. Our economy is growing and we are investing in the productive sector. We allocated the largest amount ever to agriculture and we are investing in infrastructure and energy which is the backbone of the economy,” Minister Keita added.

Source: The Standard