The International Monetary Fund has reaffirmed its confidence in Ghana’s ability to reduce its debt-to-GDP ratio to 55% by 2028, pointing to progress under the current $3 billion Extended Credit Facility program.
At the recent Spring Meetings, IMF Mission Chief Stéphane Roudet highlighted Ghana’s implementation of stronger fiscal rules and improved oversight mechanisms as positive signs.
However, economic analysts remain cautious about the sustainability of these gains. While short-term indicators show improvement, with inflation declining and fiscal deficits narrowing, deeper structural challenges persist. Ghana’s history of fiscal slippage after previous IMF programs has left many skeptical about the current trajectory.
The government’s ability to maintain discipline faces several critical tests in the coming months. Revenue mobilization remains weak compared to peer economies, with tax collections still below 13% of GDP. Though digitalization efforts at the Ghana Revenue Authority show promise, implementation gaps continue to hinder progress. Expenditure control also faces challenges, particularly with election-year spending pressures looming in 2028.
Private sector growth, essential for sustainable debt reduction, remains constrained by high borrowing costs and limited credit availability. Interest payments continue to consume nearly half of government revenue, leaving little room for productive investment. While the IMF projects 3.5% growth for 2025, this may prove optimistic without more substantial structural reforms.
As Ghana approaches the midpoint of its IMF program, the focus is shifting from short-term stabilization to long-term sustainability. The true measure of success will be whether reforms outlive the Fund’s supervision and whether Ghana can break its historical cycle of debt accumulation. With external debt restructuring still incomplete and global financial conditions tightening, the path forward remains fraught with challenges that will test the government’s commitment to fiscal discipline.
The coming months will reveal whether current reforms represent a fundamental shift in Ghana’s fiscal management or merely another temporary stabilization before familiar patterns reemerge. For now, the IMF’s optimism continues to meet skeptical reality as Ghana navigates the difficult balance between immediate stabilization and lasting transformation.
