Ghana’s 2026 Budget was framed as a bold economic reset—a departure from years of fiscal instability, currency volatility, and debt distress. Eight months into the fiscal year, early indicators suggest progress, but the real challenge lies in sustaining these gains without the IMF’s disciplining presence. As the Finance Minister prepares to present the Mid-Year Budget Review (MYBR) to Parliament, economists and policymakers are scrutinizing whether Ghana’s economic fundamentals can withstand domestic pressures, external shocks, and the looming GH¢96.1 billion debt wall of 2027–2028. Julien Ayippey, Head of Research at First National Bank, outlines six critical tests that will determine whether Ghana’s reset is merely a temporary reprieve or a lasting transformation.
1. Can Ghana Sustain Stability Without the IMF as a Referee?
The completion of Ghana’s Extended Credit Facility (ECF) with the IMF in June 2026 marked a significant milestone, signaling fiscal discipline and market confidence. However, the transition to the Policy Coordination Instrument (PCI), which replaces direct financial oversight with periodic monitoring, introduces a new risk: slippage in fiscal discipline once the IMF’s watchful eye is removed.
The primary balance target—a surplus of 1.5% of GDP—remains critical. As of March 2026, Ghana had achieved 1.2%, but sustaining this without IMF pressure will require political will and institutional resilience. The MYBR must provide transparent updates on revenue collection, particularly against the GH¢268 billion target, and confirm whether zero central bank financing—a cornerstone of the 2026 Budget—has been maintained.
Skeptics argue that fiscal restraint alone is not enough; structural reforms in tax administration, public expenditure management, and debt restructuring must follow. The review must demonstrate that discipline is not just a short-term fix but a long-term commitment.
2. Inflation: A Double-Edged Sword of Success and Rising Costs
Ghana’s inflation rate has seen dramatic fluctuations since early 2025. After plunging to a 3.2% low in March 2026—the lowest since 1985—the figure surged to 5.3% in June, driven by transport costs, rents, and school fees. While still below the 8% end-year target, the reversal raises concerns about structural inflation pressures.
Non-food inflation now accounts for 68.5% of the basket, with services inflation at 9.4%, indicating that cost pressures extend beyond staple goods. The Bank of Ghana (BoG) has held the policy rate at 14% since May, but the direction of inflation remains uncertain.
Key questions for the MYBR include:
– What assumptions underpin the fuel price forecast? Given the U.S.–Iran tensions in the Strait of Hormuz, Brent crude prices have fluctuated between US$84 and US$89 per barrel, directly impacting Ghana’s refined fuel costs.
– How will the Budget shield against prolonged geopolitical instability? A transparent revision of inflation projections—rather than silent adjustments—would restore credibility.
Without clear answers, the risk of inflationary expectations becoming entrenched persists, undermining the reset’s credibility.
3. The 2027–2028 Debt Wall: Transparency and Preparation Are Non-Negotiable
Ghana faces two critical debt repayment deadlines:
– GH¢50.3 billion in domestic debt maturities in 2027
– GH¢45.8 billion in 2028, alongside US$1 billion in Eurobond repayments in 2026 and US$2 billion in 2027
The good news is that borrowing costs have never been lower. The 91-day Treasury bill yield has fallen from 28.4% in January 2025 to 5.9% today, and the April 2026 seven-year bond raised GH¢2.7 billion at 12.5%, signaling investor confidence. However, preparation remains uneven.
The MYBR must address:
– The current balance and inflows into the revived Sinking Fund, which now receives 7% of gross non-oil tax revenue and foreign-currency dividends.
– Progress toward the GH¢20.2 billion seven-to-ten-year bond issuance target—halfway through the year, no quarterly bond issuance calendar has been published, despite repeated requests.
– Recent T-bill auctions have undershot targets, with yields drifting upward. A published bond issuance calendar would signal market confidence and reduce volatility.
Without clear debt management strategies, the 2027–2028 repayment wall could trigger another crisis.
4. Turning Cheap Money into Jobs, Not Just Cheap Borrowing
Lower interest rates have unlocked lending conditions for the first time in five years. Private-sector credit grew 41.2% year-on-year to GH¢119.6 billion by June, with non-performing loans (NPLs) falling from 23.1% to 16.1%. However, credit growth alone does not translate to economic prosperity.
The MYBR must provide concrete evidence of job creation from key programs:
– The GH¢10 billion Big Push Infrastructure Bond—where are the projects, and when will they deliver employment?
– The 24-hour economy program—how many new jobs have been created, and what is the impact on informal sector workers?
Additionally, savers are bearing the brunt of low returns. A GH¢10,000 deposit in a 91-day Treasury bill now yields only GH¢146—a near-zero real return at 5.3% inflation. The Budget must redirect savings toward longer-dated bonds, collective investment schemes, and the Ghana Stock Exchange to prevent capital flight.
5. The Cocoa Reset: Can Farmers Finally Be Paid on Time?
For 32 years, Ghana’s cocoa farmers relied on offshore syndicated loans to finance the harvest, but this system cost over US$150 million in interest alone for the 2023/24 season. The 2024/25 replacement—upfront payments by global buyers—failed, leaving farmers in arrears.
Starting 2026/27, COCOBOD will fund the crop domestically via a US$1 billion bond and commercial paper program, open to pension funds and non-resident investors. A new Cocoa Board Bill aims to:
– Bar quasi-fiscal spending (unfunded government interventions).
– Guarantee farmers at least 70% of the gross export price.
– Mandate 50% local processing, boosting value addition.
However, international cocoa prices have halved—from US$9,155 per tonne in June 2025 to US$4,272 in June 2026—while Ghana’s realized price dropped 52% year-to-date to US$3,748. This reduces revenue just as COCOBOD’s GH¢32 billion debt must be serviced.
The MYBR must clarify:
– The issuance timetable for cocoa bonds—will they compete with sovereign debt for investor attention?
– How farmer arrears from 2024/25 will be cleared—delayed payments risk eroding trust.
– How the domestic market will absorb cocoa bonds without pushing yields higher, given the GH¢20.2 billion sovereign bond target and GH¢10 billion Big Push bond.
Without transparency and execution, the cocoa reset risks repeating past failures.
6. Gold and the Cedi: Can the Recovery Hold Without Windfall Spending?
Ghana’s currency has stabilized significantly, trading at GH¢11.45 per dollar in May 2026—a stark improvement from GH¢16 in October 2024. However, the cedi depreciated 9.5% year-to-date by July 2026, and gold prices have fallen from US$5,000 to US$4,240 per ounce, reducing foreign exchange inflows.
Gross international reserves dropped from US$14.2 billion in March to US$12.9 billion in June, reducing import cover from 5.7 to 5.0 months. The gold-driven recovery was not sustainable—it relied on cyclical windfall gains, not structural reforms.
The MYBR must address:
– What gold and cocoa price assumptions underpin the Budget? A 15% drop in gold prices could trigger another crisis.
– How much of the reserve build is treated as permanent income vs. temporary windfall? Without diversification, Ghana remains vulnerable to commodity price shocks.
The Path Forward: Hard Numbers, Not Just Promises
Ghana’s economic reset has delivered tangible improvements: inflation control, bond market reopening, IMF program completion, and currency stabilization. However, the second half of 2026 and beyond will test whether these gains are sustainable without external oversight.
The Mid-Year Budget Review is not an opportunity for rhetoric—it is a moment of reckoning. The Finance Ministry must deliver:
✅ Transparent debt management strategies for the 2027–2028 wall.
✅ Clear inflation forecasts and contingency plans for geopolitical risks.
✅ Proof of job creation from infrastructure and economic stimulus programs.
✅ A viable cocoa financing model that protects farmers from price volatility.
✅ A realistic assessment of gold and cocoa price assumptions to prevent reserve depletion.
As Julien Ayippey concludes:
“This review is government’s chance to show its promised reset can hold without a safety net beneath it. The next six months will determine whether Ghana’s economic transformation is real—or just another cycle of crisis and recovery.”
The Mid-Year Budget Review must rise to the occasion.
