BY Daniel Bampoe
The much-celebrated economic turnaround in 2025, touted by Finance Minister Cassiel Ato Forson during the presentation of the 2026 Budget Statement, is not without precedent.
A closer examination of the economic record reveals that similar patterns of growth, stability, and fiscal discipline have historically occurred whenever the country is operating under the guidance of an International Monetary Fund (IMF) programme.
While the Finance Minister described the current economic performance as “historic,” the evidence points to a recurring cycle — where IMF-supported fiscal discipline temporarily restores confidence, only for structural weaknesses to resurface once the programme concludes.
Echoes from the Past: 2015–2019 And 2022–2026 IMF Eras
The macroeconomic journey under IMF supervision has followed a consistent rhythm: crisis, stabilization, and relapse. A comparative look at the country’s economic indicators between 2015–2019 and 2022–2026 shows similar patterns of fiscal improvement and monetary stability tied to IMF’s Extended Credit Facility (ECF) programmes.
During both periods, the IMF’s central objectives were the same — fiscal consolidation, debt control, and restoration of macroeconomic stability. These policies produced impressive short-term results: reduced inflation, lower policy rates, improved primary balance, and renewed investor confidence.
The Finance Minister’s 2026 budget presentation, therefore, represents more of a continuation of this cycle than a departure from it.
Monetary Gains: Inflation Control and Stronger Currency
From 2017 to 2019, Ghana achieved a remarkable turnaround in inflation and currency stability under IMF supervision. Inflation fell from 15.4% in 2016 to 9.4% in 2018, dipping further to 7.9% in 2019, within the Bank of Ghana’s target band of 8±2%.
At the time, the Monetary Policy Rate (MPR) was reduced by 550 basis points in 2017 and another 400 basis points in 2019, ending at 20%. These measures anchored inflation expectations and strengthened external reserves.
Today, the macroeconomic indicators show an almost identical trajectory. The 2025 fiscal year has seen a sharp fall in inflation, a stabilised cedi, and renewed confidence in financial markets — all underpinned by IMF programme conditions and fiscal restraint.
Fiscal Discipline: From Deficits To Surplus
Fiscal prudence has been the cornerstone of every IMF-backed reform period, and 2025 is no different. Ghana’s primary balance, which tracks government expenditure relative to revenue excluding interest payments, has once again returned to surplus territory.
In 2016, Ghana had a primary deficit of 1.4% of GDP, but by 2017, it recorded a surplus of 0.2%, followed by 1.4% in 2018 and 0.9% in 2019. The trend reemerged in 2025, with the Finance Minister announcing a primary surplus of 1.2% of GDP as of September.
These patterns highlight Ghana’s ability to stabilize its finances under IMF oversight, but they also underscore the temporary nature of such gains once external discipline is removed.
The Post-Programme Challenge: Sustainability Beyond IMF Oversight
Economists caution that while the 2025 performance is encouraging, it reflects a recurring IMF-induced rebound rather than a structural transformation.
Following the end of the 2015–2019 IMF programme, Ghana initially maintained fiscal stability. However, by 2020, the economy faced renewed pressures from the COVID-19 pandemic, the Russia-Ukraine conflict, and growing public debt — eventually leading to a sovereign default in 2022.
The cedi depreciated sharply, inflation soared above 50%, and the government lost access to international markets. These events forced Ghana back to the IMF in 2023, restarting another round of fiscal correction and monetary tightening — the very conditions now being hailed as success in 2025.
A Familiar Story of Recovery and Risk
Forson’s optimism — describing the economic state as “strong, full of hope, and back on track” — reflects the same confidence expressed by past administrations during earlier IMF programmes. Yet, economic analysts warn that true recovery depends on sustaining gains beyond the programme period, a challenge Ghana has historically struggled to meet.
