BY Issah Olegor
The economy has registered one of its most remarkable fiscal turnarounds in recent history, as the country’s total public debt experiences a steep decline, Finance Minister Dr. Cassiel Ato Forson, has announced.
Presenting the 2026 Budget Statement to Parliament on Thursday, November 13, Dr. Forson indicated that Ghana’s total public debt had dropped from GHS 726.7 billion (61.8% of GDP) in 2024 to GHS 630.2 billion (45% of GDP) as of October 2025 — a feat described as one of the sharpest declines in the nation’s economic history.
According to the Minister, this marks the first time in over a decade that Ghana has recorded a negative debt accumulation rate, falling from a positive 19.1 percent in 2024 to a negative 13.3 percent in 2025.
Forson attributed the drastic reduction to what he called the government’s commitment to “fiscal discipline, prudent borrowing, and a stronger cedi.”
“This is not just a recovery; it’s a reset,” he told Parliament. “We have restored fiscal discipline, brought inflation under control, stabilised the cedi, and rekindled investors’ confidence. This is a rebuilding from the ashes of a daunting inheritance—a heavy burden laid on us by the previous administration.”
Fiscal Turnaround
The debt distress reached a peak in 2022 and 2023, when the country defaulted on most of its external debt payments amid a severe economic downturn, high inflation, and a depreciating currency.
The situation prompted the government to seek an International Monetary Fund (IMF) bailout and embark on a domestic debt exchange programme (DDEP) in early 2023 — an unpopular but crucial move that aimed to restructure the country’s unsustainable debt.
By late 2024, public debt had soared to GHS 726.7 billion, while inflation hovered above 40 percent, pushing the government to implement stringent fiscal reforms.
Ato Forson, who assumed office following the change in administration, prioritized macroeconomic stabilization and fiscal consolidation — measures that now appear to be yielding results.
Confidence Returning to the Economy
The Finance Minister told Parliament that the government’s economic management policies have now “restored hope and credibility” to the economy.
He emphasized that the reduction in public debt and the stabilization of the cedi are signs that investor confidence is rebounding.
“Confidence is returning, the Black Star is rising once more. Ghana is back—strong and full of hope,” Forson declared, drawing applause from the House. He added that Ghana’s economy is “on a firm path of recovery,” citing renewed interest from international investors and improved domestic revenue mobilization.
Economic Indicators Show Improvement
Over the past year, Ghana has seen significant improvements in macroeconomic indicators. Inflation, which had surged past 40 percent in 2023, has reportedly been brought down to under 10 percent by the third quarter of 2025. The cedi has also stabilized against major trading currencies, supported by improved foreign reserves and fiscal restraint.
The government credits these gains to a mix of expenditure rationalization, enhanced revenue collection, and debt restructuring efforts that have reduced interest payment obligations.
According to Ato Forson, these policies have created “fiscal space” for the government to channel more resources into critical sectors such as education, health, and infrastructure.
A Budget of Consolidation and Growth
The 2026 Budget, Forson explained, seeks to consolidate the gains made in the past two years and strengthen the foundations for sustained growth.
“This budget is about building on the foundation we have laid,” he said, stressing that the government will maintain a cautious borrowing strategy while supporting key productive sectors to drive job creation and industrial expansion.
He further assured Parliament that his ministry will continue to uphold transparency and accountability in the management of public funds. “We will safeguard the gains we have made and ensure that every cedi is spent wisely for the benefit of all Ghanaians,” he stated.
