By Grace Zigah
Ghana has secured a crucial nod from global rating agency S&P Global Ratings, which has upgraded the country’s sovereign credit rating to CCC+ from its previous Selective Default (SD) status.
This development, announced on May 10, 2025, comes as the government edges closer to concluding complex debt restructuring talks with commercial creditors—a significant milestone in its economic recovery plan.
In a statement, S&P cited the government’s “recent steps to restructure remaining commercial debt” as central to the decision.
The agency specifically referenced progress following a successful Eurobond exchange in October 2024 and the near-completion of external commercial loan restructuring, particularly with international banks.
“The upgrade reflects recent steps taken by authorities to restructure remaining commercial debt… This progress follows the successful completion of local currency and Eurobond restructurings, and a memorandum of understanding with bilateral creditors signed and ratified on January 29, 2025,” S&P stated.
The stable outlook for both foreign and local currency ratings, according to S&P, signals balanced optimism, taking into account ongoing fiscal reforms, resilient economic growth, and improved external indicators, even as challenges remain.
Ghana’s transferability and convertibility rating was also confirmed at CCC+, highlighting sustained foreign exchange stability.
Ghana had slipped into Selective Default territory in 2023 following its suspension of external debt servicing as part of an effort to secure an IMF bailout and initiate a full-scale debt restructuring.
Since then, the government has successfully restructured domestic debt and secured a key IMF Extended Credit Facility, which has guided economic policy reforms and restored some investor confidence.
S&P noted that external debt currently constitutes 62% of government liabilities, or 49% of GDP, making debt sustainability highly sensitive to exchange rate fluctuations and the performance of export commodities—particularly gold and cocoa.
Additionally, S&P recognized Ghana’s strengthened external position, underpinned by higher gold export receipts and reaccumulated foreign exchange reserves.
These gains, along with a surplus in the current account and falling inflation, paint a cautiously optimistic picture.
“Economic growth remains resilient despite the protracted debt restructuring process,” S&P observed, while warning that “high debt service costs, weak tax administration, and spending overruns—especially during election years—remain structural vulnerabilities.”
As of April 2025, Ghana’s inflation stood at 21.2%, a significant drop from its 2022 peak.
Analysts attribute the easing inflation to cedi appreciation, improved monetary policy, and a decline in global energy prices.
While S&P’s upgrade is a symbolic victory for Ghana’s fiscal authorities, it is also a reminder of the work ahead.
Fiscal discipline, revenue enhancement, and long-term structural reforms remain critical to restoring full creditworthiness and investor confidence.
With the IMF programme serving as an anchor, the government’s next steps—especially the finalization of commercial debt agreements—will be pivotal in determining whether Ghana can progress further along the road to economic recovery and a return to international capital markets.
