Ever since President John Dramani Mahama was inaugurated in January 2025, Ghana has embarked on a bold and strategic path toward fiscal recovery and macroeconomic stability. Spearheaded by Finance Minister Dr. Cassiel Ato Forson, the new administration has implemented sweeping reforms aimed at restoring investor confidence, managing debt burdens, and reviving key economic indicators. A recent highlight of these efforts is the upgrade by Fitch Ratings, which raised Ghana’s Long-Term Foreign-Currency Issuer Default Rating from “restricted default” to “B-” with a stable outlook. This significant development reflects growing confidence in the West African nation’s ongoing economic recovery.
Fitch’s decision follows Ghana’s successful restructuring of approximately \$13.1 billion in Eurobond liabilities, which were renegotiated in late 2024. The country is now in advanced discussions with the remainder of its external creditors and is on track to complete the full debt restructuring process by the end of 2025. The rating agency praised Ghana for restoring normal relations with most of its commercial lenders, signaling a major step forward in re-establishing the country’s financial credibility after a period of severe fiscal distress.
Economic Indicators Show Tangible Progress
Since the change in leadership, key economic indicators have shown steady improvement. Inflation, which exceeded 50% in early 2023, has now declined to 18.4% as of May 2025—the lowest rate in over three years. Forecasts suggest further easing, with inflation expected to drop to 15% by the end of the year and reach single digits by 2026.
Ghana’s public debt-to-GDP ratio has also seen significant improvement. From a high of around 93% in 2022, the debt ratio is projected to fall to approximately 60% by the end of 2025. This reduction is attributed to successful restructuring, disciplined public spending, and improved revenue generation.
In terms of economic output, real GDP growth stood at 5.7% in 2024 and is projected at 4% for 2025. Growth is being driven by gains in agriculture, services, and industry, especially mining and manufacturing. Meanwhile, Ghana’s gross international reserves have increased to $6.8 billion, and the Ghanaian cedi has stabilised, reducing the pressure on import prices and easing the burden on households.
Government Commitment to Reform
Finance Minister Dr. Cassiel Ato Forson described the Fitch upgrade as a “decisive validation” of the government’s RESET agenda. He reaffirmed the administration’s commitment to economic reform, fiscal discipline, and inclusive growth, stating, “This is only the beginning… We are unwavering in our resolve to fully revive the economy and deliver lasting relief and shared prosperity to the good people of Ghana.”
President Mahama has made job creation, inflation control, and economic restructuring key priorities of his administration. His government has worked swiftly to restore macroeconomic stability while protecting vulnerable sectors and ensuring social spending is maintained.
Challenges Ahead
Despite this progress, challenges remain. Ghana missed its 2024 fiscal target, recording a primary deficit of 3.9% of GDP instead of the forecasted surplus. The government aims to reduce this to a 1.5% surplus in 2025, though Fitch projects a narrower adjustment to 0.5%.
There are also concerns about budget credibility and the realism of revenue targets. The Minority Caucus in Parliament has called for urgent revisions to the 2025 budget to align it with ongoing fiscal pressures and the realities of debt servicing obligations.
Another significant hurdle in the restructuring process lies with specific lenders such as the African Export-Import Bank (Afreximbank), which has resisted being included in the restructuring framework, citing its preferred creditor status. Ghana disputes this and has pushed for its inclusion in debt treatment, arguing that all creditors must share the burden fairly to ensure a sustainable solution.
As the end-2025 deadline for concluding all external debt restructuring approaches, Ghana is focused on consolidating its gains. This includes ensuring transparency in public financial management, strengthening independent fiscal oversight, expanding the tax base, and deepening reforms in sectors such as energy, agriculture, and digital infrastructure.
