Ghana achieves moderate debt distress risk for first time since 2013

Finance Minister Cassiel Ato Forson has announced that Ghana has attained a moderate risk of debt distress for the first time since 2013, marking what government describes as a major turnaround in the country’s debt sustainability outlook.

Speaking in Parliament on Tuesday, May 26, while presenting four major statutory reports before the House, Dr Forson said Ghana had moved from unsustainable debt levels to high risk of debt distress, and now to a moderate risk classification.

“Mr Speaker, I’m proud to inform the House that Ghana, for the first time since 2013, has achieved a moderate risk of debt distress, moving from unsustainable debt to high risk of debt distress and now to a moderate risk of debt distress,” the Finance Minister stated.

The announcement comes amid ongoing fiscal reforms and debt restructuring efforts under Ghana’s economic recovery programme supported by the International Monetary Fund.

Government officials say the improvement reflects progress in restoring macroeconomic stability, improving fiscal discipline, and managing public debt more sustainably.

During the parliamentary session, Dr Forson laid before the House reports relating to the administration and utilisation of energy sector levy proceeds, petroleum revenues, transfers, and public-private partnership initiatives.

Among the documents presented was the reconciliation report on the Petroleum Holding Fund for the 2025 fiscal year, submitted in line with provisions of the Petroleum Revenue Management Act.

According to the Finance Minister, the report provides a detailed account of petroleum revenues received by the state and how the funds were utilised.

Dr Forson explained that part of the report specifically addressed the use of petroleum-related revenues to support energy sector debt recovery efforts.

“Mr Speaker, this report details how the monies received and accrued to the state on the back of all the petroleum taxes were utilized, particularly the one relating to the management of the energy sector debt recovery,” he said.

He added that further details would be presented to the relevant parliamentary committee during subsequent deliberations.

“And so Mr Speaker, the details are in the report and have accordingly been presented to the Committee for deliberation and when the Committee invites us, we will go and present the details,” he stated.

Economic analysts say Ghana’s shift to a moderate debt distress risk level could improve investor confidence, strengthen government credibility in international markets, and support future borrowing negotiations.

The country has faced severe debt pressures in recent years following economic shocks, high inflation, exchange rate instability, and the implementation of the Domestic Debt Exchange Programme (DDEP).

Government has since undertaken a series of fiscal consolidation measures, debt restructuring negotiations, and economic reforms aimed at restoring sustainability and rebuilding confidence in the economy.

The IMF-supported programme has remained central to Ghana’s recovery strategy, with authorities focusing on reducing fiscal deficits, controlling inflation, stabilising the cedi, and improving debt management.

Analysts believe continued fiscal discipline and successful implementation of structural reforms will be critical to maintaining the country’s improved debt outlook in the years ahead.