<\/p>\n
Rating agency, Fitch, has projected that Ghana is likely to face liquidity pressures in the coming years, specifically in 2025 and 2026, despite the restructuring of most of its debts.<\/p>\n
Ghana’s interest rate revenue ratio is also projected to be among the highest of Fitch’s rated sovereigns.<\/p>\n
The interest rate revenue ratio is estimated at 29% in 2025 and 30% in 2026.<\/p>\n
Fitch had indicated plans to move Ghana out of sovereign default from July 2025.<\/p>\n
This follows its anticipation of the country completing the external debt restructuring by the end of June 2025.<\/p>\n
According to a myjoyonline.com report, Associate Director of Europe, Middle East, and Africa Sovereign Ratings at Fitch, Thomas Garreau, noted that Ghana’s situation requires drastic measures to enhance the country’s liquidity status.<\/p>\n
“We do consider that Ghana will still face significant liquidity pressures. We still have a very elevated interest rate revenue ratio. The interest rate will still be among the highest at approximately 30% – almost twice the emerging markets rate of 16%,” he said.<\/p>\n
“This represents quite significant liquidity pressures. Ghana has implemented a large fiscal consolidation with a 4.6 percentage points primary fiscal adjustment between 2022 and 2024,” he added.<\/p>\n
Fitch noted that key priorities include broadening the tax base and improving tax compliance to enhance domestic revenue mobilization, streamlining government operations, and curbing wasteful spending to create fiscal space.<\/p>\n
It also added that implementing policies that attract foreign direct investment (FDI) to provide much-needed development capital while reducing reliance on external borrowing will make a significant difference for Ghana.<\/p>\n
Additionally, promoting economic diversification beyond traditional sectors such as cocoa and gold is essential to building resilience against external shocks.<\/p>\n
SSD\/SA<\/p>\n
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