Ghana’s public debt ratio plunges to 44.5% after fiscal tightening

New data from the Bank of Ghana shows a dramatic improvement in the country’s fiscal position, with the public debt-to-GDP ratio dropping to 44.5% in November 2025, down from 63.1% a year earlier.

The latest Summary of Economic and Financial Data, released on January 27, 2026, reveals that total public debt fell to GH¢644.6 billion from GH¢742.5 billion in November 2024—a reduction of nearly GH¢100 billion in nominal terms.

This sharp decline is attributed to fiscal consolidation and strong nominal GDP growth. External debt stood at US$29.3 billion (22.5% of GDP), while domestic debt totaled GH¢311.0 billion (22.0% of GDP).

Government revenue and grants increased to 13.4% of GDP by November 2025, while expenditure was contained at 13.9%, down from 16.6% the previous year. This discipline resulted in a positive primary balance of 1.9% of GDP and narrowed the overall fiscal deficit to -1.4% from -5.2%.

The debt reduction coincides with a significant drop in inflation, which fell to 5.4% in December 2025 from 23.8% a year earlier. The Bank of Ghana has cut its policy rate from 27.00% to 18.00% over the same period, with average lending rates declining from 30.25% to 20.45%.

While capital expenditure remains low at 0.9% of GDP, the reduction in government borrowing is expected to ease pressure on credit markets, potentially increasing access to finance for the private sector.

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