By Alex Ababio
The International Monetary Fund (IMF) has offered one of its most positive assessments of Ghana’s recent economic performance in years, describing 2025 as a notably strong year underpinned by strict fiscal discipline, improved macroeconomic coordination, and sustained currency stability.
This rare note of optimism was delivered by the IMF’s Resident Representative in Ghana, Dr. Adrian Alter, during an interview on Joy News’ PM Express Business Edition on Thursday. His comments stood out not only because of their substance, but also because of the IMF’s well-known tradition of conservative projections and cautious language when discussing growth prospects in emerging economies.
“The IMF typically is conservative in their assessment and projections. We typically want to be surprised when it comes to growth,” Dr. Alter explained. “But overall, I would say 2025 has been a very good year.”
A Cautious Institution Strikes an Optimistic Tone
The IMF’s acknowledgment of Ghana’s improved performance carries particular weight given the country’s difficult economic trajectory in recent years. Ghana entered the IMF-supported Extended Credit Facility (ECF) programme in 2023, following severe macroeconomic imbalances, elevated inflation, currency depreciation, and a debt crisis that culminated in a domestic and external debt restructuring.
Against that backdrop, Dr. Alter’s description of 2025 as a “very good year” reflects what IMF officials see as tangible progress rather than mere short-term relief.
An IMF staff report published in April 2025 under the ECF programme review noted that “program performance has strengthened, supported by improved revenue mobilisation, expenditure control, and adherence to fiscal targets” (IMF Country Report No. 25/112).
According to the report, Ghana met key quantitative performance criteria, including the primary fiscal balance, and maintained spending discipline despite election-related pressures.
Fiscal Discipline at the Core of the Recovery
Central to the IMF’s positive assessment, Dr. Alter said, was the government’s renewed commitment to fiscal discipline, which helped restore order to public finances after years of persistent deficits and rising debt levels.
“The fiscal discipline helped to put the public finances in order,” he stated.
Ghana’s fiscal deficit, which stood at –7.3 per cent of GDP in 2022, was reduced to an estimated –3.9 per cent in 2024, with provisional 2025 figures pointing to a further narrowing to below –3 per cent, in line with IMF programme targets, according to Ghana’s 2025 Mid-Year Budget Review.
Speaking in a separate interview for this article, Dr. Joe Amoako-Tuffour, an economist and former Bank of Ghana official, described the shift as significant.
“For the first time in many years, fiscal consolidation in Ghana is not just aspirational; it is operational,” he said. “Spending controls, arrears management, and improved revenue forecasting are now actually binding.”
The Ministry of Finance’s Fiscal Performance Report (June 2025) also confirms that primary expenditure growth was kept below 10 per cent, while domestic revenue mobilisation improved through enhanced VAT compliance and digital tax systems.
Monetary Tightening and Cedi Stability
Beyond fiscal management, Dr. Alter highlighted the crucial role played by the Bank of Ghana (BoG) in stabilising the national currency, the cedi, which had experienced sharp depreciation between 2021 and 2022.
“The tight monetary policy and the accumulation of reserves by the Bank of Ghana helped with the cedi stability as well,” he said.
In 2025, the BoG maintained a tight monetary policy stance, keeping the Monetary Policy Rate (MPR) at 29 per cent for much of the year before cautiously easing as inflation trends improved. Inflation, which peaked above 54 per cent in December 2022, declined steadily to an estimated 17.8 per cent by mid-2025, according to the Ghana Statistical Service.
The BoG’s 2025 Monetary Policy Report (PDF) notes that gross international reserves increased to approximately US$8.6 billion, covering about 4 months of imports, compared to less than US$6 billion in 2022.
A senior BoG official, speaking on condition of anonymity, told this publication:
“Reserve accumulation has been deliberate. The goal was not just to defend the cedi, but to rebuild confidence in Ghana’s external position.”
Market analysts say this strategy paid off. The cedi, which depreciated by over 50 per cent in 2022, remained broadly stable in 2025, fluctuating within a narrow band against the US dollar.
Coordinated Macroeconomic Policy
IMF officials have consistently stressed that Ghana’s recent gains stem from coordination between fiscal and monetary authorities. The IMF Ghana Article IV Consultation Report 2025 underscores that policy alignment between the Ministry of Finance and the Bank of Ghana reduced policy inconsistencies that had previously undermined stability.
Dr. Alter echoed this view:
“What we are seeing is the benefit of coordinated macroeconomic policies. Fiscal restraint complements monetary tightening, and together they reinforce stability.”
Economic governance experts argue that this coordination has been one of the most under-appreciated reforms of the IMF programme.
Prof. Godfred Bokpin, Professor of Finance at the University of Ghana Business School, told this article:
“Macroeconomic coordination sounds technical, but it is politically difficult. In 2025, Ghana showed that fiscal authorities can resist pressure to overspend while monetary authorities stay focused on price stability.”
Structural Reforms Beyond Short-Term Stabilisation
While short-term stabilisation is important, Dr. Alter emphasised that structural reforms implemented in 2025 would have lasting implications for Ghana’s fiscal credibility.
“And then in terms of reforms, I would say a key structural reform implemented in 2025, there were many,” he said. “But one key reform is the improvement to the Fiscal Responsibility framework, the Fiscal Responsibility Act.”
The Fiscal Responsibility Act (FRA), originally enacted in 2018, had been suspended during periods of economic distress, including the COVID-19 pandemic. In 2025, Parliament passed amendments to strengthen the Act, re-introducing binding fiscal rules and enforcement mechanisms.
According to the Amended Fiscal Responsibility Act, 2025 (Act 1105, PDF), government is now required to maintain a fiscal deficit not exceeding 5 per cent of GDP and a positive primary balance, except under clearly defined escape clauses.
“That basically adds to fiscal rules and the plan to implement an independent fiscal Council,” Dr. Alter explained.
Independent Fiscal Council: A Game Changer?
One of the most significant reforms highlighted by the IMF is the planned establishment of an Independent Fiscal Council, a body intended to provide non-partisan oversight of fiscal policy, revenue projections, and debt sustainability.
The concept aligns with global best practices recommended by the OECD and the IMF’s Fiscal Transparency Code. An IMF technical assistance report from March 2025 states that “independent fiscal institutions enhance credibility, reduce deficit bias, and improve public trust in fiscal policy.”
Dr. Lars Svensson, a former IMF advisor and co-author of several fiscal governance studies, noted in an interview:
“If Ghana operationalises an independent Fiscal Council with real authority, it could significantly reduce the political cycle of fiscal slippages.”
However, civil society groups caution that independence will depend on how members are appointed and funded. The Institute for Fiscal Studies (IFS-Ghana), in a policy brief released in July 2025, warned that “legal independence must be matched with operational autonomy to avoid capture.”
Looking Ahead
While the IMF’s assessment of 2025 is notably positive, Dr. Alter was careful to frame it as progress rather than a final destination. IMF programme documents stress that risks remain, including external shocks, commodity price volatility, and election-related spending pressures.
Nevertheless, the consensus among IMF officials, government economists, and independent analysts is that Ghana’s performance in 2025 marks a turning point.
As Dr. Alter concluded during the Joy News interview:
“The foundations laid in 2025—fiscal discipline, credible institutions, and policy coordination—are what will determine whether this progress is sustained.”
For a country that only a few years ago was grappling with debt distress and macroeconomic instability, the IMF’s description of 2025 as a “very good year” signals more than cautious optimism—it reflects a hard-won restoration of economic credibility built on discipline, reform, and institutional strengthening.