Due to several military interventions in government, the economy experienced ups an downs culminating in a near collapse by 1982. In 1983, Ghana embarked on an Economic Recovery Program (ERP) that saw the economy recovering sufficiently to experience GDP growth rates of 4-5% per annum from 1989 to 1999. By the year 2000 when the new administration of the NPP took over from the NDC, all the key macro-economic indicators were in disarray. Year on year inflation averaged 30-40%; interest rate was 40-46%; GDP 3-4%; GDP per capita US$300-360; Exchange rate between Ghana’s currency and its major trading partners depreciated at a high rate reaching 49.2% in 1999 and 96.8% 2000. Consequently, certain social facilities such as education and health began to crumble. Unemployment of most resources including labour was very high, and standard of living was negatively affected.
This situation convinced the new government to adopt the Highly Indebted Poor Countries Initiative (HIPC) in 2001. This has been successfully managed resulting into more than US$4 billion of debt cancellation.