Dr Sharif Mahmud Khalid is the Economic Policy Advisor to the Vice President
The Economic Policy Advisor to the Vice President, Dr Sharif Mahmud Khalid, has attributed the recent Fitch upgrade of Ghana’s credit rating to the Domestic Debt Exchange Programme (DDEP), rather than to structural reforms.
He explained that the upgrade reflects an improvement in the country’s risk profile due to debt restructuring, rather than long-term economic changes.
Fitch Ratings recently upgraded Ghana’s Long-Term Foreign-Currency Issuer Default Rating from ‘Restricted Default’ to ‘B-’ with a Stable Outlook.
“If you look at these ratings, when we took office, remember that Professor [Bokpin] mentioned, we started to make some gains thanks to the Domestic Debt Exchange Programme. The DDEP delivered some gains, and obviously, that would impact any external rating,” Dr Khalid was quoted by myjoyonline.com.
He emphasised that the upgrade is “artificially” influenced by the DDEP and not by deep or sustainable economic reforms.
“What it means is that, artificially, there would be some gains thanks to the Domestic Debt Exchange Programme. When we took over office, we committed to reactivating the Sinking Fund and to meeting all our obligations,” he said.
Dr Khalid further explained that the government has taken steps to build financial buffers, which contributed to Fitch assigning a Stable Outlook, signaling an improvement in Ghana’s risk of defaulting on debt payments.
He described the reactivation of the Sinking Fund as an “insurance measure” to reassure external creditors of Ghana’s debt servicing capacity.
“If you’ve activated a sinking fund, which is an insurance measure to service most of these debts, and then committed to both external and domestic debt programmes, it’s naturally going to reflect positively in the ratings,” he said.
However, Dr Khalid cautioned that this ratings upgrade should not be interpreted as a signal for Ghana to re-enter the international capital market.
“This is not for the internal market—this is for the external market, which we are not yet ready to re-engage. We believe in stabilising the domestic market first,” he concluded.
SSD/MA