Dr. Alhassan Iddrisu, Government Statistician in a pose with President John Dramani Mahama
Adnan Adams Mohammed
In spite of global trade tensions, some economists have reposed confidence in the country’s fragile economy, which has a history of vulnerability to external shocks.
Among such is the Government Statistician, Dr. Alhassan Iddrisu, who has said despite external headwinds, including the ongoing global tariff war, Ghana’s economy continues to show signs of resilience.
According to provisional data from the Ghana Statistical Service, the economy expanded by 5.3% in the first quarter of 2025, up from 4.9% recorded during the same period in 2024. At a press briefing the Government Statistician explained that the latest figures suggest that Ghana has, so far, managed to shield its economy from the adverse effects of global trade tensions.
“We are all aware of what is happening. All other things being equal, one would have assumed that because of the trade war and trade tension, it should have a significant dampening effect on growth. What we are seeing is that the numbers we are seeing for the first quarter of 2025 in terms of growth don’t seem to suggest that the impact of the trade tensions is very significant on Ghana but this is early days yet. Data shows so far Ghana has been resilient and robust in terms of absorbing the shocks with regards to the trade tensions,” he said.
Meanwhile, a Managing Partner at policy advisory firm Konfidants, Michael Kottoh, has indicated that, amid rising global trade tensions, Ghana has a unique opportunity to position itself as a strategic export hub, particularly within the African Continental Free Trade Area (AfCFTA).
Speaking at the 2025 Citi Business Forum themed “The Global Tariffs Dispute: Navigating Ghana’s Recovery Strategy,” and held in Accra on Thursday June 12, he noted that while trade wars between major economies pose risks, they also open doors for smaller economies like Ghana to capitalise on emerging supply chain gaps.
“In terms of opportunities, we could seize U.S. niche advantages while rivals pay higher tariffs,” he noted. “Lesotho has been crying a lot, South Africa is complaining a lot—we could potentially, using AfCFTA, attract some of that export.”
A Pathway to Garment Sector Growth
Kottoh emphasised the potential for Ghana to expand its garment and textile sector by absorbing production contracts that are under pressure in other African nations.
Countries like Lesotho, which have been struggling with shifting global trade conditions, could see some of their export-oriented manufacturing relocate to Ghana, he suggested.
“Lesotho could relocate some of those contracts to Ghana,” Kottoh explained. “So these are potential advantages—but we need to be strategic and understand which product lines, which value chains, which alliances and partnerships are required to take advantage of these.”
Strategic Planning Is Key
While the global tariff disputes have created disruptions in traditional trade routes, Kottoh cautioned that Ghana’s ability to benefit from these shifts will depend on clear strategy, sector-specific focus, and targeted partnerships across supply chains.
“We need to be strategic and understand which product lines, which value chains, which alliances and partnerships are required to take advantage of these.”
Disjointed Africa’s trade policy response
Consequently, the Chief Executive Officer of the African Centre for Economic Transformation (ACET), Mavis Owusu Gyamfi, is worried over Africa’s lack of a coordinated response to global economic disruptions, particularly in the wake of tariff hikes initiated by the United States.
Also, speaking at the 2025 Citi Business Forum under the theme “The Global Tariffs Dispute: Navigating Ghana’s Recovery Strategy,” she highlighted that other regions, notably Asia, responded swiftly and strategically to the recent tariff increases announced by U.S. President Donald Trump.
She questioned Africa’s lack of a unified and proactive stance in contrast to the Asian response, noting that despite not having a formal bloc like the African Union or a framework like the African Continental Free Trade Area (AfCFTA), Asia was able to organise an effective strategy.
She expressed disappointment in Africa’s silence and lack of coordination in the face of rising global economic tensions. She urged the African continent to approach global economic shocks with a collective strategy rather than panicking.
“Where is our common voice? Remember, Asia is not a bloc. It doesn’t tout to be AU or AfCFTA or any of the things we are so proud about. It doesn’t do it. It doesn’t have a theoretical framework that it is proud of, but it had a structure for implementation in a crisis.
“The thing that disappointed me the most in all of this was that Africa forgot why we set up the AfCFTA in the first place. Africa forgot the processes we have in place for the African Union. In fact, Africa forgot we had the AFDB because it wasn’t until a week ago that I heard an AFDB statement on the tariffs,” she stated.
President John Mahama in a discussion with Dr Cassiel Ato Forson
Adnan Adams Mohammed
All things being equal, President John Mahama’s ‘BIG PUSH’ initiative will soon receive a boost as the government prepares to re-enter the international bond market amidst soaring investor confidence.
This comes as Fitch Ratings has upgraded Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR) from ‘Restricted Default’ to ‘B-’ with a Stable Outlook, signalling a major vote of confidence in the country’s ongoing economic recovery under the stewardship of Finance Minister Dr. Cassiel Ato Forson.
The upgrade reflects significant progress in Ghana’s fiscal and debt management, following the successful restructuring of $13.1 billion in Eurobond debt and the near-completion of outstanding external debt negotiations. Fitch notes that Ghana has normalised relations with most commercial creditors and expects full restructuring to be finalised by the end of 2025. This will usher Ghana back onto the international bond market to access funds for its developmental agenda.
The NDC in its election 2024 manifesto indicated it will roll out the ‘Big Push’ for national infrastructure development to continue its legacy of massive infrastructure development to boost growth and create sustainable jobs.
The “Big Push” is a policy aimed at driving national infrastructure development in Ghana, focusing on completing abandoned projects, revamping the Ghana Infrastructure Investment Fund, and expanding water supply systems.
This initiative includes a US$10 billion accelerated plan and specific projects like the Sogakope Trans-Boundary Water System and the Pwalugu multi-purpose dam.
According to the Fitch report, one of the standout achievements is the sharp decline in inflation, which has dropped from 23% in 2024 to 18.4% in May 2025—the lowest rate in over three years. Inflation is expected to continue falling, averaging 15% in 2025 and 10% in 2026, supported by tight monetary policy, fiscal discipline, and improved exchange rate stability.
The Ghana cedi has appreciated significantly in recent months, reversing previous trends and helping to ease price pressures on imported goods and fuel. Fitch credits the cedi’s strong performance to renewed confidence in Ghana’s macroeconomic fundamentals and proactive interventions by the Ministry of Finance and the Bank of Ghana.
Finance Minister Dr. Cassiel Ato Forson has led a bold economic reset since assuming office, with a clear strategy focused on fiscal consolidation, debt sustainability, and restoring market confidence. Under his leadership:
Ghana’s public debt-to-GDP ratio is projected to decline to 60% in 2025, down from 93% in 2022; Gross international reserves are now at $6.8 billion, with more growth expected in 2025 and 2026; The fiscal deficit is narrowing, with a projected primary surplus of 0.5% of GDP in 2025.
Interest payments now consume only 25% of revenue, down from 48% in 2021; Real GDP growth remains solid, at 5.7% in 2024 and projected at 4% in 2025.
In response to the credit upgrade, senior officials at the Ministry of Finance attributed Dr. Forson’s firm policy direction and stakeholder engagement for restoring Ghana’s credibility in global markets.
“This milestone reflects the Finance Minister’s bold leadership in navigating Ghana out of default and laying the foundation for sustainable growth,” one official stated. “Lower inflation, a stronger cedi, and renewed investor interest are all signs that the economy is stabilising.”
The Fitch upgrade is more than a technical rating change—it’s a significant endorsement that will boost Ghana’s appeal to foreign investors, support the reopening of domestic capital markets, increase the country’s access to cheaper credit and ease pressure on public finances.
Dr. Forson, speaking earlier this month, reaffirmed the government’s commitment to staying the course:
“We are building an economy that works for everyone. This upgrade is a signal that Ghana is back on track, and we will not relent in protecting the gains we’ve made.”
Ghana’s path from default in 2022 to a ‘B-’ stable outlook in mid-2025 represents one of the strongest sovereign credit turnarounds in sub-Saharan Africa in recent years. But as Dr. Forson and the Ministry of Finance continue to emphasise, this is not the finish line. With inflation declining, the exchange rate stabilising, and debt falling, the Fitch upgrade is not only a win for the government but a hopeful sign for all Ghanaians looking forward to a more stable and prosperous future.
The Government of Ghana has started hoping that a key macroeconomic target for 2028 – that of reaching a public debt sustainability threshold of between 56% and 58% of Gross Domestic Product, could actually be achieved as early as the end of this year. This is coming on the back of the Cedi’s sharp appreciation against the United States dollar which has seen it appreciate more than 40% against the American green back this year – far outperforming its African and emerging market peers – and thus shrinking the cost of the country’s foreign debt and giving it more fiscal breathing room.
“We have reduced our total debt over the last five months by almost GHc150-billion, which is very significant” President John Dramani Mahama revealed at a session during the African Development Bank annual meeting in Abidjan last week, citing the cedi strength.
“If that trajectory continues, the target of reaching 55-58% debt sustainability by 2028 will be reached by the end of this year. And that means that it begins to give us fiscal space to begin to invest in the most productive sectors of the economy.”
The global standard for debt sustainability in emerging market economies, as set by the International Monetary Fund and the World Bank is a public debt to GDP ratio of 60% although some heavily indebted middle income countries outside of an IMF programme tend to regard the threshold as 70% of their GDP.
Ghana’s debt to GDP ratio had fallen to 70.5% of its GDP by the end of 2024, following fundamental restructuring of its public debt, down from an estimated 79.18% in 2021 which however did not include the country’s legacy energy debt and its debt overhang from the funding of a comprehensive financial services industry reform between 2017 and 2020. Indeed, computations that added on those debts put Ghana’s ratio at closer to 90%, persuading the IMF to insist that the country restructure its public debt towards sustainability before assenting to provide a three year Extended Credit Facility programme inclusive of a front-loaded US$3 billion financial bail out in 2023.
In all the cedi had gained 42% against the dollar since January, changing hands near GHc10.20 to the dollar as at mid last week before slipping a little towards the end of the week.
The rally, which has surprised some investors, is another much-needed boost for Ghana as it claws its way back from debt default and a punishing economic crisis.
While the dollar has also been under pressure this year, the cedi’s performance stands in stark contrast to other African currencies.
The cedi’s appreciation has been fueled by several factors, both external and internal one of them being the strategic interventions of the country’s central bank. The Bank of Ghana (BoG) has played a pivotal role through aggressive monetary tightening and forex market interventions
Another pivotal factor has been the commodity revenue windfall arising out of the ongoing price surges in two of Ghana’s main traditional exports, gold and cocoa. Surging gold prices—from US$2,000 per ounce in 2024 to US$3,400/ounce in May 2025— have boosted export revenues with Ghana earning US$2.72 billion from gold exports alone during first four months of 2025 up from US$900 million during the corresponding period of 2024.
Cocoa prices nearing US$10,000 per ton have further bolstered inflows, combining with gold, oil and non- traditional exports to take Ghana’s trade surplus to a long term high of US$4.3 billion in 2024.
Yet another factor has been the impacts of the ongoing three year International Monetary Fund programme, which includes an insistence on a return to demand management economic policies to restore macroeconomic stability after the near-chaos that reigned from late 2022 to late 2023.
Local Ghanaian holders of dollar debt exchanging their money back into cedis are also helping the gains.
There has been a key external factor too in that the dollar’s depreciation, driven by U.S. tariff wars and a falling Dollar Index (DXY) from 108 to 99 in 2025, have amplified the cedi’s relative strength.
However while Ghana now looks to reaping the benefits of a stronger cedi with regards to its debt sustainability it is by no means a given yet as potential headwinds still exist.
Tellimer’s Hasnain Malik, a sovereign country analyst and Lutz Röhmeyer, head of portfolio management at Capitulum Asset Management, have both warned that the cedi’s rally may not last, citing drops in oil and cocoa prices, as well as IMF forecasts that imply a possible coming depreciation.
The current strengthening of Ghana’s economy evident by significant improvements in its key economic performance indicators strongly shows growing confidence in the fortunes of businesses and consumers.
The Bank of Ghana data published last week, after the its Monetary Policy Committee, shows easing inflation, disciplined fiscal management, favourable external sector developments amidst tightening policy rate as key ingredients behind the country’s improving economic performance.
Headline inflation has declined consecutively in the first four months of the year by 2.6 percentage points to 21.2% in April 2025, driven by the lowering of both food and non-food inflation.
“A confluence of factors, including tight monetary policy stance, stepped-up liquidity sterilization efforts, downward revisions in ex-pump petroleum prices, and exchange rate stability have supported the gradual decline in inflation” BoG Governor, Dr Johnson Asiama explained last week when delivering the decision of the Monetary Policy Committee to retain its benchmark Monetary Policy Rate at 28%.
“The Bank’s core inflation measure, which excludes energy and utility prices, as well as inflation expectations of consumers, businesses, and the banking sector point to easing inflationary pressures.”
Similarly, the recently installed President John Dramani Mahama administration has reigned in the fiscal slippages that its predecessor government often fell prey to.
“Fiscal policy implementation so far has been broadly aligned with the 2025 Budget. In the first quarter of 2025, provisional data on budget execution indicated that although revenues fell below target, some expenditure rationalisation took place to accommodate the revenue shortfall” affirmed Dr Asiama.
“The primary fiscal balance (on commitment basis) has also improved in the first quarter. Continued maintenance of a strict fiscal consolidation for the 2025 Fiscal Year will further strengthen the ongoing recovery process and firm up macroeconomic stability.”
Key to the ongoing turnaround has been the external sector which has continued to improve, with a record provisional current account surplus of US$2.1 billion in the first quarter of 2025, driven mainly by higher prices and increased production volumes of gold and cocoa, and strong remittance inflows.
The current account surplus, together with net outflows in the capital and financial account, resulted in an overall Balance of Payments surplus of US$1.1 billion. The strong external performance resulted in significant reserve accumulation. Gross International Reserves (GIR) amounted to US$10.7 billion in April 2025, equivalent to 4.7 months of import of goods and services.
“Broadly, the external sector outlook remains favourable, largely anchored on expectations of increased gold and cocoa export receipts, as well as inflows from remittances” enthused Dr Asiama last week.
“The cedi has rebounded strongly against the major trading currencies driven by a combination of factors, including tight monetary policy stance, ongoing fiscal consolidation, record reserve accumulation, strict enforcement of foreign exchange market rules, and improved market sentiment.”
Indeed in the year to May 21, 2025, the cedi had appreciated against all the major currencies – 24.1 percent against the US dollar, 16.2 percent against the British pound, and 14.1 percent against the euro.
“The latest forecast points to continued easing of inflationary pressures on the back of tight monetary policy stance, exchange rate stability, and fiscal consolidation” the BoG Governor enthused.
“Inflation is expected to ease faster towards the medium-term target in the first quarter of 2026 as opposed to the second quarter as earlier envisaged, barring unanticipated shocks.”
This looks set to deliver palpable rewards. The BoG’s high frequency real sector indicators point to a sustained pickup in economic activity. The updated Composite Index of Economic Activity increased by 2.3 % year-on-year in March 2025, compared with 1.0% over the same period last year, mainly driven by exports, credit to the private sector, and construction activities.
In addition, the Ghana Purchasing Managers’ Index rose above the 50-benchmark as output and new orders increased, signaling improved growth prospects. Based on easing inflationary pressures and optimism about macroeconomic conditions, the latest confidence surveys conducted by the BoG showed significant improvement in consumer and business expectations going forwards, the highest in the last seven years.
BoG data signals improved macroeconomic indicators, boosting business and consumer confidence.
By TomaImirhe
Ghana’s ongoing macro-economic turnaround is finally being rewarded by significant improvements in its key economic performance indicators and this in turn is engendering strongly growing confidence in the fortunes of businesses and consumers alike, going forward.
Data released by the Bank of Ghana last week, following the latest meetings of its Monetary Policy Committee, points to lowering inflation, fiscal discipline, the tight monetary policy stance and favourable external sector developments as key ingredients behind the country’s improving economic performance.
Headline inflation has declined consecutively in the first four months of the year by 2.6 percentage points to 21.2% in April 2025, driven by the lowering of both food and non-food inflation. “A confluence of factors, including tight monetary policy stance, stepped-up liquidity sterilizationefforts, downward revisions in ex-pump petroleum prices, and exchange rate stability havesupported the gradual decline in inflation” BoG Governor, DrJohnson Asiama explained last week when delivering the decision of the Monetary Policy Committee to retain its benchmark Monetary Policy Rate at 28%.“The Bank’s core inflation measure, which excludesenergy and utility prices, as well as inflation expectations of consumers, businesses, and the banking sector point to easing inflationary pressures.” Similarly, the recently installed President John DramaniMahama administration has reigned in the fiscal slippages that its predecessor government often fell prey to.
“Fiscal policy implementation so far has been broadly aligned with the 2025 Budget. In the first quarter of 2025, provisional data on budget execution indicated that although revenues fell belowtarget, some expenditure rationalisation took place to accommodate the revenue shortfall” affirmed DrAsiama.“Theprimary fiscal balance (on commitment basis) has also improved in the first quarter. Continued maintenance of a strictfiscal consolidation for the 2025 Fiscal Year will further strengthen the ongoing recovery processand firm up macroeconomic stability.” Key to the ongoing turnaround has been the external sectorwhich has continued to improve, with a record provisional current account surplusof US$2.1 billion in the first quarter of 2025, driven mainly by higher prices and increasedproduction volumes of gold and cocoa, and strong remittance inflows. The current accountsurplus, together with net outflows in the capital and financial account, resulted in an overallBalance of Payments surplus of US$1.1 billion. The strong external performance resulted insignificant reserve accumulation. Gross International Reserves (GIR) amounted to US$10.7billion in April 2025, equivalent to 4.7 months of import of goods and services.
“ Broadly, theexternal sector outlook remains favourable, largely anchored on expectations of increased goldand cocoa export receipts, as well as inflows from remittances” enthused DrAsiama last week. “The cedi has rebounded strongly against the major trading currencies driven by a combinationof factors, including tight monetary policy stance, ongoing fiscal consolidation, record reserveaccumulation, strict enforcement of foreign exchange market rules, and improved marketsentiment.”
Indeed in the year to May 21, 2025, the cedi had appreciated against all the major currencies – 24.1 percent against the US dollar, 16.2 percent against the British pound, and 14.1 percent against the euro. “The latest forecast points to continued easing of inflationary pressures on the back of tight monetary policy stance, exchange rate stability, and fiscal consolidation” the BoG Governor enthused.“Inflation is expected toease faster towards the medium-term target in the first quarter of 2026 as opposed to the secondquarter as earlier envisaged, barring unanticipated shocks.”
This looks set to deliver palpable rewards. The BoG’s high frequency real sector indicators point to a sustainedpickup in economic activity. The updated Composite Index of Economic Activity increased by2.3 % year-on-year in March 2025, compared with 1.0% over the same period last year, mainly driven by exports, credit to the private sector, and construction activities. In addition,the Ghana Purchasing Managers’ Index rose above the 50-benchmark as output and new ordersincreased, signaling improved growth prospects. Based on easing inflationary pressures andoptimism about macroeconomic conditions, the latest confidence surveys conducted by the BoG showed significantimprovement in consumer and business expectations going forwards, the highest in the last seven years.
Public pressure mounts as traders are given a 60-day window to reduce prices following the cedi’s appreciation.
Adnan Adams Mohammed
Some key stakeholders of the Ghanaian economy have taken a swipe at traders for their delay in reducing prices of goods and services to align with the current appreciation of the local currency, the Cedi.
This follows a 60-day grace period given to traders by the Ghana Union of Traders Association (GUTA), after a high-level meeting with the Minister for Trade and Industry, Elizabeth Ofosu-Adjare, to reduce prices of goods and services in the country. But, the two month grace period has been criticised as too long a time of allowing extortion of consumers by traders.
In recent weeks, the cedi has shown marked resilience, reversing years of depreciation — a development that has reignited public expectations for downward price adjustments, especially for imported goods.
”Well it’s justified to some extent”, Professor Peter Quartey, Director of Institute for Statistical, Social, and Economic Research (ISSER) said while commenting on demands by consumers on traders to reduce their prices.
“Anytime the exchange rate depreciates quickly traders increase prices but as soon as it appreciates then there is some sluggishness in reducing prices but we also appreciate the fact that some have imported using the old exchange rates.”
Also, the West African Regional Director of CUTS International, Appiah Kusi Adomako has argued that the 60-day window is overly generous to businesses and unfair to consumers.
“The 60 days is a bit generous to businesses, but to the consumers, I don’t think it is fair, because anytime prices go up, the cedi begins to fall badly. We can even see prices jumping three times in a day. And sometimes people even use the predictive prices of the cedi to the dollar to sell their goods in the market,” Mr. Appiah Adomako Kusi said.
He stressed that businesses often increase prices instantly when the cedi depreciates, sometimes even based on projected exchange rates, and therefore should not delay reductions now that the currency is gaining value.
He acknowledged that some businesses may still be selling old stock or clearing goods at the ports, but cautioned that new goods arriving after May 15 should not exploit the 60-day grace period.
“Now that the cedi has started to appreciate in value, I think it will be fair that businesses should gradually reduce prices as the cedi appreciates. So that by the end of the 60th day, we should be able to get full benefits coming to consumers.
“I think it’s also fair for the consumer to ride on the gains of the cedi against the dollar.”
Meanwhile, General Secretary of the Food and Beverages Association of Ghana, Samuel Ato Aggrey, has expressed optimism that ongoing market forces will compel traders to reduce prices of goods within the next 60 days, owing to the strengthening Ghana cedi and mounting public pressure.
Ato Aggrey, in an interview last week explained that as some businesses begin to reflect the cedi’s recent appreciation in their pricing, competition will naturally push others to follow suit or risk losing customers.
“We are hopeful that within those 60 days, the prices will change. Some of them have already started seeing the effect. If you go to the market and do your survey, you will know that some of the prices of goods have come down,” he said.
“By 60 days, we are going to see uniformity in the prices of goods, because what will happen is that those who will be reducing their prices will create a lot of competitive atmosphere in the market. Therefore, if your goods are still selling at a high price, you will be forced to reduce them.
“If you are not careful, and you say you’re going to maintain your old price, you are going to create an atmosphere of competition that will go against you,” he warned..
The Minister for Trade, Industry, and Agribusiness, Elizabeth Ofosu-Adjare, after a closed-door meeting with key business groups, including the Ghana Union of Traders Association (GUTA), the Association of Ghana Industries (AGI), and the Food and Beverage Association of Ghana (FABAG), said that the government cannot compel traders to reduce prices, despite the recent appreciation of the Cedi and easing inflation.
According to her, Ghana’s liberalised market system limits the government’s ability to enforce price controls, making dialogue the most viable path to achieving relief for consumers.
She revealed that some manufacturers have already indicated a willingness to reduce prices in response to recent macroeconomic gains such as a stronger Cedi and declining inflation
“The meeting has been fruitful and we have said that the government does not have the power to control prices, but it has the power to negotiate with our stakeholders to ensure traders, manufacturers, and consumers to ensure that they take advantage of opportunities when they happen.
“I am happy to inform you that the direct importers have agreed to reduce their prices, some have already started that. We have also heard from GUTA and AGI that it is good that the Cedi has stabilised but they need a bit of time for it to reflect in the prices. It will happen gradually,” she stated.
“Lower global food prices and a resilient local currency have contributed to easing inflation in Ghana.”
Adnan Adams Mohammed
Ghana’s rate of inflation declined to 21.2 percent in April, 2025, the lowest in eight months.
The improvement from the 22.4% recorded in March reflects the fifth consecutive month of disinflation.
This means consumer prices fell by 0.8% month-on-month during the period under review as analysts attribute the improvement to a stronger local currency which has helped curb import-related price pressures.
Both food and non-food inflation moderated during the period, contributing to the downward trend.
Food inflation slowed to 25.0% in April from 26.5% in March, while non-food inflation decelerated to 17.9% from 18.7%.
“The Consumer Price Index (CPI) for April 2025 was 258.6, up from 213.3 recorded in April 2024. This represents a year-on-year inflation rate of 21.2%, meaning that the general price level in April 2025 was 21.2% higher than in April 2024”, Government Statistician, Alhassan Iddrisu, announced in Accra last week. “This marks a 1.2 percentage point decrease from the previous inflation rate of 22.4%, indicating that inflation slowed by 1.2 percentage points over the period. Encouragingly, this is the fifth consecutive time that inflation has declined.”
Meanwhile, analysts had projected a further slowdown in Ghana’s inflation for April driven by relatively stable petrol pump prices and a steadier cedi.
A report by Databank Research anticipated that the disinflation trend will persist, supported largely by improved food supply dynamics. However, on the broader outlook, the report warned that sustaining this downward momentum will hinge on monetary policy decisions.
It warns that any premature interest rate cut, particularly at the upcoming May 2025 Monetary Policy Committee meeting, could reverse the gains, despite the policy rate having been raised to 28 percent in March.
“These marginal drops indicate a balanced contribution from both sectors of the consumer basket”, the Government Statistician added.
Consequently, global food prices are expected to decline for a second consecutive year in 2025, driven primarily by a significant slump in rice prices, as abundant global supplies and relaxed export restrictions weigh on the market.
The World Bank’s latest Commodity Markets Outlook forecasts a 7% year-on-year decrease in its food price index, with each of its three main sub-categories, grains, oils and meals, and other food items, projected to record declines.
Grain prices are expected to see the steepest fall, dropping by 11%, largely due to a projected 29% plunge in rice prices.
This outlook is attributed to strong global production and the easing of India’s export restrictions.
India, which accounts for about 40% of global rice exports, is projected to increase output by 5% in the 2024-25 season. Globally, rice production is forecast to rise by 2%.
Despite this short-term weakness, rice prices are expected to remain relatively stable in 2026, as both supply and demand are projected to grow in tandem, according to early estimates from the International Grains Council.
Wheat prices are also likely to trend downward through 2026, amid concerns about trade-related demand. However, the decline may be cushioned by tight supply conditions.
While global wheat output is close to record levels, it is anticipated to fall slightly below consumption, resulting in reduced inventory levels.
Maize prices, on the other hand, are expected to ease by 2% in both 2025 and 2026. Weaker crude oil prices, dampening ethanol demand, alongside growing U.S.-China trade tariffs are likely to suppress demand.
Additionally, maize’s price advantage over wheat and soybeans is expected to encourage expanded cultivation, adding further downward pressure.
Even so, the fall in prices could be limited by historically low stock levels, which are set to reach their lowest in over a decade.
The Ghana Statistical Service (GSS) is urging coordinated efforts from households, businesses, and government to maintain the country’s current disinflation path, following a marginal drop in the national inflation rate.
Dr Iddrisu encouraged households to be prudent in their spending. “Continue to manage expenditures cautiously and remain responsive to changes in prices of items such as food and transport, which have shown volatility.”
He called on businesses to leverage the easing cost environment to stabilise operations, particularly in areas reliant on transport and imported inputs such as restaurants and accommodation services. He further urged the government to stay the course on macroeconomic measures and maintain ongoing social intervention programmes to protect lower-income households.
These include initiatives like the Livelihood Empowerment Against Poverty (LEAP), the Capitation Grant, and the School Feeding Programme.
In his remarks, he highlighted the need for closer monitoring of food markets, particularly high-inflation items like ginger, beans, and vegetable oil.
He also emphasized accelerating support for agriculture, saying the government must “fast track the implementation of the Agriculture for Transformation Programme to reduce food inflation, particularly on vegetables, tubers, and plantains which have a high weight in the CPI basket.”
Dr. Iddrisu concluded by stressing the importance of inflation literacy, urging that “public education on inflation dynamics be strengthened to promote informed household decision-making.”
“World Bank and IMF revise growth projections amid global economic uncertainty.”
Adnan Adams Mohammed
The World Bank Group has revised its projection on Ghana’s 2025 Gross Domestic Product (GDP) growth rate downwards by 0.4 % to 3.9% from its earlier projection of 4.3%.
The Bretton Woods institution explained that; persistent inflationary pressures and ongoing external vulnerabilities were the key reasons for the downgrade. Highlighting climate-related risks (particularly, unpredictable weather patterns that have disrupted cocoa production in Ghana), it also warned that, climate-induced events such as floods and droughts continue to erode national budget revenues across Africa by up to 9%, causing economic setbacks of between 2% and 5% in terms of growth.
The Group’s revised rate, as contained in the April 2025 edition of the Africa’s Pulse report, is significantly different from other major projections on Ghana’s economic growth in 2025. The Standard Bank has projected the highest growth rate forecast of 5.4% for Ghana in 2025 with the African Development Bank Group also forecasting 4.3% growth for Ghana in 2025 while DataBank Research predicts the lowest growth rate forecast, of 3.6% for Ghana in 2025. However, Ghana’s 2025 budget targets a real GDP growth rate of at least 4.0% and a non-oil GDP growth rate of at least 4.8%.
Meanwhile, over the medium-term, the World Bank remains cautiously optimistic about Ghana’s prospects, projecting a rebound to 4.6% growth in 2026 and 4.8% in 2027 rating Ghana among a few African economies showing early signs of recovery from 2025.
“Business activity in Mozambique and Ghana rebounded in February 2025,” the Group noted in its new report published last week. “The modest uptick in Ghana was driven by increased demand and a resurgence in new business engagements.”
High-frequency indicators, particularly the Purchasing Managers Index (PMI), suggest an uptick in business activity. Ghana’s PMI rose from 47.9 in January to 50.6 in March, indicating improved demand, easing supply bottlenecks, and renewed investor confidence following the December 2024 presidential elections.
Across the region, Sub-Saharan Africa’s economic growth is expected to rise slightly from 3.3% in 2024 to 3.5% in 2025, with further acceleration to 4.3% by 2026–2027.
However, the continent’s overall trajectory remains constrained by expected weak performances in its three largest economies—Nigeria, South Africa, and Angola. Excluding these, the rest of Sub-Saharan Africa is projected to grow by 4.6% in 2025, rising to 5.7% by 2027.
Still, the World Bank has warned that elevated downside risks—including global policy uncertainties, climate shocks, and fiscal constraints—pose ongoing threats to a sustained and inclusive recovery across the continent.
In related news, the International Monetary Fund (IMF) has sharply cut its global growth forecast 2.8% in 2025, a significant drop from the 3.3% forecast made in January, as contained in the newly published IMF’s April 2025 World Economic Outlook (WEO), which cites escalating trade tensions with the United States announcing a wave of new tariffs and trading partners responding with their own countermeasures, creating ripple effects across global supply chains and dampening investor sentiment.
It also cites mounting policy uncertainty as the other main culprit behind the lower growth forecast.
“Since the release of the January 2025 WEO Update, a series of new tariff measures by the United States and countermeasures by its trading partners have been announced and implemented, ending up in near-universal US tariffs on April 2 and bringing effective tariff rates to levels not seen in a century.
“This on its own is a major negative shock to growth. The unpredictability with which these measures have been unfolding also has a negative impact on economic activity and the outlook and, at the same time, makes it more difficult than usual to make assumptions that would constitute a basis for an internally consistent and timely set of projections.
“Given the complexity and fluidity of the current moment, this report presents a ‘reference forecast’ based on information available as of April 4, 2025 (including the April 2 tariffs and initial responses), in lieu of the usual baseline. This is complemented with a range of global growth forecasts, primarily under different trade policy assumptions.
“The swift escalation of trade tensions and extremely high levels of policy uncertainty are expected to have a significant impact on global economic activity. Under the reference forecast that incorporates information as of April 4, global growth is projected to drop to 2.8 percent in 2025 and 3 percent in 2026—down from 3.3 percent for both years in the January 2025 WEO Update, corresponding to a cumulative downgrade of 0.8 percentage point, and much below the historical (2000–19) average of 3.7 percent,” part of the report read.
In advanced economies, growth is now expected to slow to 1.4% in 2025, with the U.S. economy seeing a notable downgrade—now projected at 1.8%, nearly a full percentage point below previous estimates.
In emerging markets and developing economies, growth is expected to slow down to 3.7% in 2025 and 3.9% in 2026, with significant downgrades for countries affected most by recent trade measures, such as China. Global headline inflation is expected to decline at a pace that is slightly slower than what was expected in January, reaching 4.3% in 2025 and 3.6% in 2026, with notable upward revisions for advanced economies and slight downward revisions for emerging market and developing economies in 2025.
The IMF has flagged intensifying downside risks, warning that a deeper trade war, rising financial instability, and fragile policy buffers, could worsen the economic landscape. Vulnerable emerging markets could face capital flight, currency pressures, and increasing debt burdens.
The Fund however noted that a reversal or de-escalation of current trade policies could offer a reprieve and potentially revive global growth.
“Intensifying downside risks dominate the outlook. Ratcheting up a trade war, along with even more elevated trade policy uncertainty, could further reduce near- and long-term growth, while eroded policy buffers weaken resilience to future shocks. Divergent and rapidly shifting policy stances or deteriorating sentiment could trigger additional repricing of assets beyond what took place after the announcement of sweeping US tariffs on April 2 and sharp adjustments in foreign exchange rates and capital flows, especially for economies already facing debt distress.
“Broader financial instability may ensue, including damage to the international monetary system. Demographic shifts and a shrinking foreign labor force may curb potential growth and threaten fiscal sustainability. The lingering effects of the recent cost-of-living crisis, coupled with depleted policy space and dim medium-term growth prospects, could reignite social unrest. The resilience shown by many large emerging market economies may be tested as servicing high debt levels becomes more challenging in unfavorable global financial conditions.
“More limited international development assistance may increase the pressure on low-income countries, pushing them deeper into debt or necessitating significant fiscal adjustments, with immediate consequences for growth and living standards. On the upside, a de-escalation from current tariff rates and new agreements providing clarity and stability in trade policies could lift global growth,” it added.
The report calls for coordinated policy action, urging nations to work together to restore predictability in trade, strengthen debt sustainability, and address long-term structural challenges like demographic shifts and migration.
Cedi maintains steady footing against the dollar in 2025, buoyed by policy discipline and gold exports.
By Toma Imirhe & Elorm Desewu
Considering that 2025 is another year during which Ghana will not have access to the international capital market it is only to be expected that both participants in the local economy and international direct investors would be nervous about the direction and quantum of the change in the exchange rate between the Ghanaian cedi and the United States dollar over the coming months.
Indeed it would appear they have good reason to worry. The relative exchange stability enjoyed by the cedi during the latter years of the previous decade and the start of this one were primarily achieved by heavy borrowing of US dollars in the form of annual Eurobond issues of US$3 billion, most of which was used to prop up the supply of foreign exchange on the local currency market. However when the three international sovereign credit ratings agencies – Fitch, Moodys and Standard & Poors – all decided that Ghana’s public forex debt was unsustainable towards the end of 2022 and Bloomberg began justifying the resultant price discounts and consequent sharp rise in yields on Ghana-issued Eurobonds to investors still holding on to them, the real cost of this cavalier strategy became clear.
Since then, the value of the cedi against the US dollar has fallen to barely a third of what it used to be, with a dollar trading for GHc15.56 by mid April 2025 on the interbank forex market – and a significantly higher GHc16.10 on the retail market – compared with a little over GHc6 to a dollar as at the third quarter of 2022. Instructively the cedi’s free fall continued through to 2024, with the currency depreciating by 28% against the American greenback last year alone.
But Ghana’s pivotal change of government from the erstwhile profligate Nana Akufo-Addo administration to the much more fiscally restrained incumbent President John Dramani Mahama administration, coupled with favourable developments in the country’s key international commodity export markets have changed the exchange rate trajectory sharply. While the cedi still depreciated sharply during the first quarter of 2025 when the Mahama administration was settling in – by 5.36% against the dollar – this was followed by marginal appreciation at the start of April which narrowed the year to date fall to less than 3%, and relative exchange rate stability since then.
Speaking after the 123rd Monetary Policy Meeting in late March, Governor of the Bank of Ghana, Dr. Johnson Asiama, announced a set of measures aimed at stabilizing the Ghanaian cedi, as the currency faces continued pressure against major foreign currencies.
These include tightening monetary policy to control inflation, enhancing foreign exchange reserves and structural reforms to address exchange rate misalignment.
Dr. Asiama stresses the need for monetary and fiscal coordination, inflation control, and structural reforms to restore confidence in the cedi.
“On top of the projected steady growth for 2025, the international markets have priced in a much stronger US economy stemming from the policies to be implemented by the new US administration. This has already instigated a stronger US dollar with implications for emerging markets and developing economies, including Ghana” he warns.
“Complementary fiscal and monetary policies will therefore have to be carefully set to prevent spillovers to the Ghanaian economy.
“External sector conditions remain positive, with sustained and stronger-than-programmed rebuilding of reserve buffers contributing to the stability of the domestic currency. The performance of the external sector (in 2024) was mainly driven by strong growth in gold exports, which also largely impacted positively on growth. In the outlook, the external sector is expected to remain strong as commodity prices remain favourable amid improvements in production. Overall, while the external sector conditions are expected to provide an anchor to exchange rate stability, key risks in the outlook including challenges in the energy sector will have to be closely monitored.”
Importantly he is backing his words with concrete action. The Bank of Ghana supported the foreign exchange market with US$264.4 million in March 2025 alone to preserve the stability of the cedi.
Indeed, such interventions reflect the growing size of Ghana’s gross international reserves and the consequent ability to both provide forex liquidity in the local market and directly intervene in it when deemed necessary.
Easily the biggest contributor to this newfound strength is gold, which is continuously setting new international market price records by the week. The price of a fine ounce of gold is currently around US$3,227 and is rising so fast that even Goldman Sach’s earlier forecast of a closing price for the year of over US$3,500 now looks much too conservative.
Apart from enjoying the direct benefits of the ongoing unprecedented price surge, it is also encouraging investment in increased production in Ghana and, more recently, concerted efforts by the new government to formalize small scale mining (most of which has been illegal and environmentally unfriendly) and take control of the sale of the gold it produces, much of which has been smuggled out in the past.
Databank Research expects the new government to prioritize domestic mining, boosting gold production to bolster reserves. According to its Ghana Outlook report for 2025 “In the aftermath of the elections, the new government may focus on enhancing domestic mining companies to boost gold production. This comes at a time when gold reserves have been steadily increasing in recent years, standing at 37.52 metric tonnes as of the second quarter of 2024, with projections indicating a rise above the levels recorded in 2023. We believe the move will further augment gold reserves and offer a potential cushion for the Cedi.”
Oil prices are falling too but this is a double edged sword, favouring consumers who might be able to enjoy price cuts at the pump on imported petroleum products, and lower diesel import costs for powering thermal electricity stations, but putting government’s forex revenue target from crude oil exports in jeopardy.
Cocoa prices are still hovering not too far behind the over US$10,000 per ton they peaked at last year and Ghana’s production looks set to exceed its 617,000 target for the current crop season, but about a third of this is going into fulfilling supply contracts that the country defaulted on during the previous disastrous crop season.
Commodity prices on international markets – and to a lesser extent, production – are outside the complete purview of government itself, but the Mahama administration is proving prudent in the fiscal management and economic policy measures that it can control and these are already yielding palpable results which are not going unnoticed both at home and abroad.
Databank Research predicts that political stability after the 2024 elections is expected to attract foreign direct investment (FDI) and portfolio inflows, easing speculative pressures on the cedi. Disciplined fiscal policies are projected to reinforce this recovery.
“We expect a successful 2024 election to bring renewed confidence in the Ghanaian economy which should lead to increased foreign direct investment and portfolio inflows. This development would bolster investment sentiments around the cedi and reduce speculative attacks on the currency,” Databank Research notes.
Indeed, following Ghana’s Eurobond debt restructuring in 2024, Moody’s and Fitch upgraded the country’s ratings, with Moody’s moving its issuer rating from “Caa3” to “Caa2” and assigning a positive outlook.
Databank also predicts further upgrades as economic indicators improve, strengthening the cedi.
“Following the successful Eurobond debt rework in the 3rd quarter of 2024, global rating agencies Moody’s and Fitch upgraded Ghana’s long-term local and foreign currency issuer ratings. Moody’s upgraded the issuer rating from “Caa3” to “Caa2” and “Ca”, respectively, and assigned a positive outlook,” Databank notes.
“Fitch Solutions followed with the upgrades, assigning a “CCC+” to Ghana’s new USD bonds from the initial “CCC”. We expect a further upgrade as the rating agencies cited that continuous improvement in economic indicators would attract higher upgrades. We expect these developments to improve sentiments around the Cedi and allow for its stability,” the research firm predicts.
Inevitably quantitative forecasts for the cedi’s exchange rate performance against the US dollar vary from one forecasting firm to another, depending on the specific nature of their econometric modelling and trend analyses. But instructively none of the forecasts predict major depreciation during 2025.
Coin Codex, an American economic and financial forecaster expects that in 2025, the exchange rate between the US dollar and the Ghanaian Cedi is anticipated to range between GHc 15.06 and GHc 16.91, leading to an average annualized price of GHc 15.90.
World renown accounting and management consulting firm Deloitte predicts that in 2025, the improved investor confidence arising from the relatively peaceful election, the conclusion of the government’s debt restructuring negotiations, periodic International Monetary Fund (IMF) disbursements and higher gold export receipts will boost the international reserves level of the country and support the cedi’s value.
Gov Capital Forecasts expects the US dollar to exchange at GHc15.70 by the end of the third quarter of this year.
What all these forecasts have in common though is that the exchange rate will remain more or less stable through 2025 which means currency traders planning to take positions against the cedi – a major cause of cedi depreciation in the past – would be better off investing in government or Bank of Ghana bills which offer better returns on their investment.
Dr. Forson leads gov’t push for fiscal discipline under IMF programme.
Adnan Adams Mohammed
The Government of Ghana has consistently declared its intent to rally around the fiscal discipline, integrity and goodwill of government officials to ensure its meeting the targets of the International Monetary Fund Extended Credit Facility programme.
The President John Dramani Mahama administration inherited an ongoing IMF programme from the previous administration. The fourth review of the program just ended last week with the government securing a staff-level agreement pending the Board’s approval for the release of the fourth tranche of US$370 million of the financial bailout of US$3 billion in total.
Despite the Fund’s dissatisfaction with the previous government’s failure to comply with the targets set in the last quarter of last year – although recording an improved balance of payment position and Gross Domestic Product growth – Ghana’s Finance Minister, Dr Cassiel Ato Forson has made personal commitments to lead the charge to meet all targets under the IMF arrangement going forward, reinforcing the administration’s credibility with both domestic and international partners, while assuring that government’s efforts would continue to focus on inclusive growth, job creation, and protecting the poor and vulnerable.
“We remain fully committed to the implementation of the programme and will do all it takes to ensure that its objectives remain on track”, Dr Cassiel Ato Forson said while speaking at a joint press conference held by the Ministry of Finance, Bank of Ghana and the IMF itself, at the end of the 4th review.
“This is about building the Ghana We Want—together. We fully recognize the sacrifices made by every Ghanaian as we work together to restore macroeconomic stability and secure a brighter future for our nation.”
To achieve these objectives, the Ministry of Finance has unveiled a series of ambitious structural reforms aimed at restoring fiscal discipline, increasing transparency, and reinforcing debt sustainability, as part of Ghana’s ongoing IMF-supported recovery programme.
Dr. Ato Forson further outlined measures being taken to reverse prior breaches of structural and quantitative targets.
“We have worked tirelessly to reverse the situation and, in some cases, fast-tracked the implementation of certain structural reforms ahead of schedule,” he assured
Among the most significant reforms is the commissioning of the Auditor-General, supported by two international firms, to audit and validate the legitimacy of the 2024 arrears.
The results, expected within eight weeks, will guide corrective action and promote accountability.
Further reforms include amendments to the Public Financial Management Act and the Procurement Act to introduce fiscal rules and enhance control over public expenditure.
A newly established Compliance Desk will monitor adherence across Ministries, Departments and Agencies, backed by a soon-to-be-published compliance league table.
“These bold steps are not just technical fixes—they are about restoring trust in public financial management,” Dr. Forson added, emphasizing the importance of long-term credibility and sustainability in Ghana’s economic governance.
