Debt Repayments And Forex Interventions Slow Ghana’s Reserve Growth

According to a report by Ghana web on Saturday October 24, 2026, Ghana’s efforts to build a stronger foreign exchange reserve position are facing mounting challenges as external debt repayments, interventions in the foreign exchange market and the need to supply dollars to businesses compete for the country’s available foreign currency.

The competing demands are creating difficulties for the government and the Bank of Ghana (BoG) as they work towards achieving an ambitious target of accumulating enough international reserves to cover 15 months of imports by the end of 2028.

The reserve accumulation strategy, implemented under the Ghana Accelerated National Reserve Accumulation Programme (GANRAP), requires close coordination among the Bank of Ghana, the Ghana Gold Board (GoldBod) and the Ministry of Finance to ensure that foreign exchange generated by the economy is managed effectively.

However, the country’s substantial external financial obligations and the central bank’s responsibility to maintain stability in the foreign exchange market could slow the pace at which reserves increase.

Data from the Bank of Ghana’s September economic and financial report showed that Ghana’s gross international reserves stood at approximately US$12.05 billion as of September 22, 2026.

The amount was equivalent to about 4.5 months of import cover, falling short of the government’s target of accumulating reserves sufficient to cover 8.6 months of imports by the end of 2026.

The longer-term objective is to increase the country’s reserve buffer to 15 months of import cover by the end of 2028, a move intended to strengthen Ghana’s ability to withstand external economic shocks and meet its international payment obligations.

Achieving these targets will require substantial foreign exchange inflows and careful management of the funds available to the central bank.

The challenge is that foreign currency generated through exports and other economic activities cannot all be retained as reserves.

Some of it must be used to service external debts, support essential imports and meet the foreign exchange needs of businesses operating in the domestic economy.

Consequently, the government must balance its ambition to accumulate reserves against the immediate financial requirements of the country.

One of the major pressures on Ghana’s reserve accumulation programme is the volume of external debt payments expected over the coming years.

International Monetary Fund (IMF) projections indicate that Ghana’s total external debt service obligations could reach approximately US$4.7 billion in 2026, increase to US$5.05 billion in 2027 and rise further to US$5.3 billion in 2028.

These payments represent significant demands on the country’s foreign exchange resources at a time when the government is seeking to build a much larger reserve buffer.

Ghana must also meet its scheduled financial obligations to the IMF. The Fund’s payment schedule indicates that payments of approximately SDR103 million are due for the remainder of 2026, followed by SDR244 million in 2027 and SDR262 million in 2028.

The debt obligations mean that a considerable portion of the foreign currency available to the country will be required to meet existing commitments rather than remain within the central bank’s reserve holdings.

Although building international reserves can strengthen confidence in the economy and improve its capacity to withstand external shocks, the government must ensure that its reserve accumulation strategy does not undermine its ability to meet scheduled payments.

The situation therefore highlights the importance of aligning reserve management with the country’s debt repayment calendar.

The Bank of Ghana also faces the responsibility of managing volatility in the foreign exchange market.

The central bank intervenes when necessary to address imbalances between the supply of and demand for foreign currency, reduce excessive exchange-rate fluctuations and limit the inflationary consequences of a sharp depreciation of the cedi.

Such interventions can help businesses obtain the dollars they need to pay for imports and other international transactions. They can also help prevent sudden movements in the exchange rate from creating additional uncertainty for households and businesses.

However, when the central bank sells foreign currency into the market, part of its available foreign exchange is used to meet domestic demand rather than retained to increase international reserves.

This creates a difficult policy balance: the Bank of Ghana must maintain sufficient reserves to protect the economy while also ensuring that the domestic market has access to the foreign currency needed for commercial activities.

The central bank introduced a Foreign Exchange Operations Framework in November 2025 to improve transparency and establish clearer objectives for reserve accumulation, market intermediation and exchange-rate interventions.

The framework is intended to help the authorities manage foreign exchange resources more systematically while supporting stability in the domestic market.

The Ghana Gold Board has emerged as an important source of foreign exchange under the country’s reserve accumulation programme, particularly through the purchase and export of gold produced by artisanal and small-scale miners.

Gold export proceeds provide the country with foreign currency that can be transferred to the Bank of Ghana to strengthen its reserve position or supplied to commercial banks to support businesses and importers.

According to figures reported by Ghana Guardian, GoldBod generated approximately US$1.871 billion in foreign exchange proceeds in September 2026, exceeding its target of US$1.4 billion.

Of the total proceeds, about US$1.170 billion was transferred to the Bank of Ghana for reserve accumulation, while US$701.3 million was sold to authorised commercial banks.

The performance demonstrated the potential of gold exports to support the government’s foreign exchange objectives.

However, GoldBod’s October plan reflects the need to divide available proceeds between building reserves and meeting the domestic economy’s demand for dollars.

Under the reported plan, the Board is targeting US$1.5 billion in foreign exchange receipts, with US$1 billion earmarked for authorised commercial banks and US$500 million allocated to reserve accumulation.

The arrangement illustrates the competing priorities facing policymakers. Directing more foreign exchange to the central bank could accelerate reserve growth, but supplying commercial banks is also important for importers and businesses that depend on foreign currency to operate.

The authorities must therefore determine how much of the foreign exchange generated through gold exports should be retained as reserves and how much should be released into the domestic market.

Ghana’s dependence on gold-related foreign exchange inflows also exposes the reserve accumulation programme to movements in international commodity prices.

A decline in gold prices could affect the value of export proceeds generated by GoldBod, potentially reducing the amount of foreign currency available for reserve accumulation if export volumes and other conditions remain unchanged.

At the same time, substantial external debt repayments and continued demand for dollars from businesses could place further pressure on the country’s foreign exchange resources.

This means that Ghana’s ability to meet its reserve targets will depend not only on the volume of foreign exchange generated but also on how effectively the authorities manage competing demands on those resources.

Strengthening foreign exchange inflows from sectors beyond gold could help reduce this vulnerability and provide a more diversified foundation for reserve accumulation.

Improving export performance, supporting other foreign exchange-generating industries and limiting avoidable outflows could also help the country retain more foreign currency over time.

The challenges facing Ghana’s reserve accumulation programme have increased the importance of coordination among the Bank of Ghana, GoldBod and the Ministry of Finance.

A more integrated approach could link GoldBod’s projected monthly foreign exchange receipts with the central bank’s intervention requirements and the government’s external debt repayment schedule.

Such coordination would help policymakers anticipate periods of heightened demand for foreign currency and determine how much can realistically be added to reserves without disrupting essential payments or the domestic foreign exchange market.

The authorities may also need to strengthen fiscal discipline, improve the management of foreign exchange outflows and address financial pressures in sectors such as energy that can create additional demands on public resources.

Ultimately, achieving the target of 15 months of import cover by the end of 2028 will require Ghana to generate substantial foreign exchange while managing its use carefully.

The latest developments underline a central challenge for the country’s economic policy: generating more dollars is important, but retaining enough of those dollars after debt repayments and market interventions will be critical to building sustainable international reserves.

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