Rating agency, Fitch, has projected that Ghana is likely to face liquidity pressures in the coming years, specifically in 2025 and 2026, despite the restructuring of most of its debts.
Ghana’s interest rate revenue ratio is also projected to be among the highest of Fitch’s rated sovereigns.
The interest rate revenue ratio is estimated at 29% in 2025 and 30% in 2026.
Fitch had indicated plans to move Ghana out of sovereign default from July 2025.
This follows its anticipation of the country completing the external debt restructuring by the end of June 2025.
According to a myjoyonline.com report, Associate Director of Europe, Middle East, and Africa Sovereign Ratings at Fitch, Thomas Garreau, noted that Ghana’s situation requires drastic measures to enhance the country’s liquidity status.
“We do consider that Ghana will still face significant liquidity pressures. We still have a very elevated interest rate revenue ratio. The interest rate will still be among the highest at approximately 30% – almost twice the emerging markets rate of 16%,” he said.
“This represents quite significant liquidity pressures. Ghana has implemented a large fiscal consolidation with a 4.6 percentage points primary fiscal adjustment between 2022 and 2024,” he added.
Fitch noted that key priorities include broadening the tax base and improving tax compliance to enhance domestic revenue mobilization, streamlining government operations, and curbing wasteful spending to create fiscal space.
It also added that implementing policies that attract foreign direct investment (FDI) to provide much-needed development capital while reducing reliance on external borrowing will make a significant difference for Ghana.
Additionally, promoting economic diversification beyond traditional sectors such as cocoa and gold is essential to building resilience against external shocks.
SSD/SA
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