Ghana’s public debt expanded significantly in 2025, even as a stronger cedi helped ease the burden in local currency terms, highlighting a complex fiscal picture.
New figures from the Bank of Ghana show that the country’s total debt stock in dollar terms increased by $11.9 billion, rising from $49.4 billion in December 2024 to $61.3 billion by the end of 2025.
However, the sharp increase contrasts with a decline in debt when measured in cedis. The local currency value of public debt fell from GH¢726.7 billion to GH¢641 billion over the same period, largely due to a strong appreciation of the cedi.
The currency strengthened significantly from GH¢14.70 to the dollar in late 2024 to about GH¢10.45 by the end of 2025, supported by heavy foreign exchange interventions estimated at over $11 billion.
This appreciation provided temporary fiscal relief by reducing the domestic cost of servicing external debt and helping to stabilise inflation. It also eased pressure on businesses that rely on imports, as exchange rate stability lowered input costs.
Despite this, the rise in dollar-denominated debt raises concerns about long-term sustainability. External debt obligations remain tied to the US dollar, meaning any future depreciation of the cedi could quickly increase repayment costs and strain public finances.
With Ghana’s economy valued at around $111 billion, the debt-to-GDP ratio now stands at about 55 percent, reflecting both increased borrowing and improved macroeconomic indicators.
Analysts say the government’s strategy of using foreign exchange interventions to stabilise the cedi has helped maintain investor confidence and market stability. However, they caution that this approach may be difficult to sustain in the face of global economic shocks, including commodity price volatility and tightening financial conditions.
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The latest data underscores the need for continued fiscal discipline, as Ghana balances borrowing for development with efforts to maintain debt sustainability.
Going forward, experts stress the importance of boosting domestic revenue, managing expenditure efficiently, and reducing reliance on external borrowing to safeguard the country’s economic stability.
