Ghana could still reduce its public debt to the legally required 45 percent of gross domestic product by 2034 even if the government eases its fiscal target from 2027, according to the International Monetary Fund (IMF).
The recommendation could give policymakers greater room to spend on critical development priorities while keeping the country’s debt reduction plans on track.
The IMF said Ghana could lower its operational primary surplus target from 1.50 percent of GDP to 0.50 percent from 2027 without derailing its long-term debt objective, provided the move is supported by stronger structural reforms and tighter public financial management.
The assessment signals a possible shift in Ghana’s post-crisis fiscal strategy after years of aggressive budget tightening under the IMF-supported Extended Credit Facility programme, which began in 2023 following the country’s debt crisis, domestic debt restructuring and external debt default.
Since then, the government has focused on restoring fiscal credibility by reducing borrowing and rebuilding macroeconomic stability. However, the Fund believes maintaining an operational primary surplus of 1.50 percent of GDP over a prolonged period may be difficult given Ghana’s growing need to invest in infrastructure, education, healthcare and social protection.
“Recent debt reduction gains and large development needs have raised concerns about the excessively tight medium-term fiscal stance under the current operational target,” the IMF said.
The primary balance, which measures government revenue minus non-interest expenditure, is one of the key indicators used to assess whether a country’s debt is on a sustainable path.
According to the IMF, reducing the operational primary surplus target to 0.50 percent of GDP would create additional fiscal space for development spending while still allowing Ghana to achieve its debt target by 2034.
The recommendation follows amendments to the Public Financial Management Act approved by Parliament in 2025. The revised law introduced a debt anchor requiring public debt to fall to 45 percent of GDP by 2034 and set an operational fiscal rule requiring a primary surplus of 1.50 percent of GDP on a commitment basis.
The Fund said Ghana’s debt framework already contains what it described as “substantial in-built safeguards”, including a debt anchor set below conventional debt sustainability thresholds to provide room for the economy to absorb future shocks without immediately threatening debt sustainability.
It also noted that the framework reflects Ghana’s past experience with volatile interest and growth trends, fiscal slippages and significant stock-flow adjustments.
Historically, Ghana’s public debt has also been driven by factors beyond the annual fiscal deficit, including exchange-rate movements, the accumulation of arrears, financial sector interventions and liabilities linked to state-owned enterprises.
The IMF therefore stressed that achieving long-term debt sustainability would require more than meeting annual fiscal targets. Instead, it urged the government to strengthen public financial management through tighter expenditure controls, better commitment management and stronger monitoring of fiscal risks to reduce unexpected debt accumulation.
The Fund also said Ghana could improve domestic revenue mobilisation through more efficient tax administration, stronger compliance and efforts to close revenue collection gaps, reducing the need to rely solely on spending cuts or higher tax rates to maintain fiscal discipline.
