Fitch Solutions has indicated that the ruling National Democratic Congress (NDC) government will pursue fiscal consolidation in line with the current International Monetary Fund (IMF) arrangement.
According to the UK-based firm, it is highly unlikely that the government will withdraw from the programme following unsuccessful renegotiation attempts. This is given Ghana’s reliance on IMF assistance for external stability.
“We think it is highly unlikely that the authorities will pull out of the programme following unsuccessful renegotiation attempts, given Ghana’s reliance on IMF assistance for external stability.”
According to Fitch Solutions, IMF funding is crucial for foreign exchange liquidity and underpins investor confidence in Ghana’s economic management, making it essential for macroeconomic stability.
Fiscal Tightening to Result in Some Public Resistance
It continued that fiscal tightening—while ensuring macroeconomic stability—will, however, result in some public resistance.
Despite inflation falling from the January 2023 high of 53.6% year-on-year to 23.5% in January 2025, it remains well above the 10-year pre-pandemic average of 12.1%.
Fitch Solutions said this, combined with reduced government spending and a higher tax burden, will continue to squeeze household finances and fuel public dissatisfaction with the government.
“This will keep protest activity high by historical standards, although we note that demonstrations will remain localised and short-lived, posing minimal risks to commercial operations”, it added.
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