Ghana Finance Minister Defends 2027 Fiscal Adjustment: ‘Taking Back 1% Won’t Hurt the Economy’

Finance Minister Dr. Cassiel Ato Forson has defended the government's decision to reduce the primary surplus target by one percentage point of GDP in 2027, insisting that the overperformance of 2025 has created enough fiscal room to redirect resources toward job creation without destabilising the economy.

Speaking in an interview on Thursday, November 12, 2026, after presenting the 2027 Budget to Parliament, Dr. Forson said the government deliberately exceeded its fiscal anchor to establish credibility with investors and development partners.

"In 2025, the anchor, as approved by Parliament, was for me to do 1.5% of GDP primary surplus. I did 2.5% of GDP," he said. "So we saved 1% of GDP. Taking back 1% in 2027 would not harm the economy."

The IMF Endorsement

The fiscal adjustment has received backing from the International Monetary Fund. In its staff-level agreement on the first review of Ghana's Policy Coordination Instrument, the IMF said the 2027 budget "targets a primary surplus of 0.5 percent of GDP, consistent with the program and building on past strong fiscal consolidation, while freeing space for priority spending on job creation and infrastructure."

IMF Mission Chief Ruben Atoyan added that "the fiscal space created will be used for investment, focused on the priorities under the New Economy, including creating job and investment opportunities and closing the infrastructure gap."

The Fund, however, cautioned that "rigorous project appraisal, competitive procurement, and strict expenditure controls will be critical to ensure value for money and preserve debt sustainability."

The 'Shock Therapy' Argument

Dr. Forson characterised the government's earlier fiscal stance as "shock therapy" — a deliberate overdose of austerity designed to stabilise an economy battered by debt distress and inflation.

"I call it the shock therapy, to provide the necessary shock to the economy to stabilise something that ideally would have taken 10 years," he said. He argued that the measures achieved in two years what might otherwise have taken a decade.

The 2027 Budget reduces the primary surplus target from 1.5% to 0.5% of GDP, freeing approximately 1% of GDP for the government's New Economy Programme, a US$10 billion initiative running from 2027 to 2030. For 2027 alone, GH¢30 billion — equivalent to 1.5% of GDP — will be invested in the programme.

The Jobs Imperative

The urgency behind the fiscal shift is stark. Dr. Forson confirmed that 1.34 million Ghanaians aged 15 to 24 are neither in employment, education, nor training — the NEET category — and warned the figure could reach 1.7 million within four years without intervention.

"This is a bomb waiting to explode," he said.

Parliamentary disclosures from June 2026 paint a similar picture. Youth unemployment for those aged 15 to 24 rose from 32% in December 2024 to 32.5% by the third quarter of 2025, with Greater Accra reaching 49.3%. When the NEET definition is extended to age 35, the figure rises to 1.95 million.

The Political Risk

The minister's defense comes as the government faces scrutiny over whether the New Economy represents genuine transformation or a rebranding of existing initiatives. The Minority has challenged the government to account for jobs created, citing Ghana Statistical Service data showing persistent youth unemployment.

For Dr. Forson, the argument is straightforward: having done more than required to stabilise the economy, the government has earned the right to redirect resources toward the crisis that threatens to undermine it. Whether the New Economy delivers the jobs — and whether the fiscal buffer proves sufficient if global conditions deteriorate — will determine whether that argument holds.