Ghana’s total public debt has marginally increased to $49.5 billion as of March 2025, according to the latest report from the Bank of Ghana. This slight rise, up from $49.4 billion in February, comes despite the remarkable strengthening of the Ghanaian cedi against major foreign currencies during the same period.
In local currency terms, the total debt reached GH₵769.4 billion, compared to GH₵768.1 billion the previous month. This debt-to-GDP ratio now stands at 55%, reflecting a relatively stable fiscal position amidst improved macroeconomic conditions.
One of the notable developments within this period is the decline in the domestic portion of the debt, which fell from GH₵328 billion to GH₵326.9 billion. Analysts attribute this to the government’s conservative approach to domestic borrowing, marked by a reduction in treasury bill issuances.
However, the external debt portion increased modestly, climbing from GH₵440.1 billion ($28.3 billion) to GH₵442.5 billion ($28.5 billion). This external debt now constitutes 31.6% of the nation’s GDP, while domestic debt accounts for 23.4%.
The Bank of Ghana’s report also emphasizes the extraordinary recovery of the cedi, which has made significant gains against major currencies. Between February and March 2025, the cedi was appreciated by an impressive 24.1% against the US dollar, 16.2% against the British pound, and 14.1% against the Euro.
By May 2025, the cedi was trading at approximately GH₵11.85 to the US dollar, GH₵15.84 to the British pound, and GH₵13.34 to the Euro. This recovery marks a significant turnaround for the currency, reversing years of consistent depreciation and fostering optimism for enhanced investor confidence.
Experts view the stable debt trajectory and the cedi’s appreciation as evidence of Ghana’s improving economic fundamentals. However, the marginal rise in external debt underscores the importance of balancing fiscal discipline with growth-focused investments.
As Ghana navigates its economic challenges, stakeholders remain keenly focused on maintaining the delicate balance between debt sustainability and the need for development financing.
Story by: Mercy Addai Turkson #ahotoronline.com
