There is a huge difference between the amount of domestic revenue mobilized by the Ghana Revenue Authority (GRA) and the amount borrowed by government on the treasury bill market in the first quarter of the year.
Checks by The High Street Journal reveal that government borrowed a staggering GH¢95 billion on the short-term market in the first quarter of 2025. This compares to an amount of GH¢64 billion borrowed on the T-bill market in the same period last year. The difference represents a 48% increase over the period.
When compared to the domestic revenue mobilized by the Ghana Revenue Authority (GRA), it significantly outpaced the GH¢41 billion mobilized in domestic revenue. It is worthy of note that the GH¢41 billion is an improvement over the target of GH¢36 billion, hence exceeding the target by GH¢5 billion.
Although the revenue mobilization improved, its widening gap between short-term borrowing is raising fresh concerns over the country’s fiscal sustainability, rising debt stock, and the persistence of the budget deficit.
The government, in the 2025 budgeted announced plans to shrink the deficit in 2025. On a commitment basis, the overall deficit is projected at GH¢43.8 billion, representing 3.1% of GDP from 3.9% of GDP in 2024, with a primary surplus of GH¢20.3 billion, representing 1.5% of GDP. On a cash basis, the deficit is forecast at GH¢56.9 billion at 4.1% of GDP alongside a primary surplus of GH¢7.3 billion, representing 0.5% of GDP.
However, with the huge borrowing in the first quarter compared to less than half the revenue mobilized in the same period, there is a concern if the planned budget deficit will stay on course and not spiral out of control.
Analysts say the trend is unsustainable and could worsen Ghana’s already strained public finances. This has huge implications for Ghana’s public debt.
The first quarter fiscal trajectory underscores the urgent need for structural reforms to boost domestic revenue sustainably, cut unproductive expenditures, and improve the efficiency of public financial management. There is also the need for the government to maximize revenues from commodities such as crude oil, gold, cocoa, and other export products that bring in revenue. This will complement the domestic tax revenue mobilized by the GRA and keep the deficit in check.
While the GRA’s performance is commendable, government must aggressively implement its fiscal consolidation and discipline plans. There is a need for a cut-down on short-term market borrowing and to build a more resilient revenue base that supports long-term development without escalating debt vulnerabilities.
Until then, the alarming disparity between borrowing and revenue mobilization will continue to weigh heavily on Ghana’s economic recovery and long-term fiscal health.
