Ghana’s painful spending cuts in 2025 may have created the conditions for an economic rebound this year, according to economist Dr. Daniel Amateye Anim, who says the country is now at a turning point.
Speaking to The High Street Journal (THSJ), the Chief Economist at PIED Africa explained that the government’s belt-tightening last year wasn’t a matter of choice but of necessity.
“With the global capital markets essentially closed to Ghana due to our debt situation, the government’s only option is to tighten spending to improve the fiscal picture,” Dr. Anim noted.
The sharp reduction in public expenditure slowed road and school projects, delayed payments to contractors, and forced many Ghanaians to endure stalled infrastructure and fewer opportunities.
Dr. Anim said that while the decision was fiscally sound, it came with an unavoidable human cost.
“This may be the right move now, to restore confidence and put our house in order,” he said.
“But it won’t bring immediate relief to citizens who are looking for more jobs, better roads, or improved public services.”
Finance Minister Dr. Cassiel Ato Forson reinforced this stance during his 2025 Mid-Year Budget Review in Parliament, making clear that the government would stay the course despite the hardship. He told lawmakers that economic developments in the first half of the year did not warrant any revision to the macroeconomic targets or appropriations for 2025, insisting that the fiscal path laid out in January would remain intact.
Ato Forson outlined the government’s macroeconomic goals, pointing to a determination to hold steady: overall real GDP growth of at least four percent, non-oil GDP growth of 4.8 percent, and an end-year inflation rate of 11.9 percent. He also stressed the aim of maintaining a primary balance surplus of 1.5 percent of GDP and keeping gross international reserves strong enough to cover no less than three months of imports.
He said these figures are designed to “anchor confidence and signal Ghana’s commitment to stay disciplined while supporting recovery,” warning that any deviation could jeopardize the stability that has been achieved so far.
Now, as 2026 unfolds, there is growing anticipation that last year’s sacrifice could finally begin to yield results. Inflation has eased slightly, the cedi has stabilised, and debt servicing costs have started to fall, creating the space for renewed investment and the restart of projects put on hold.
Dr. Anim believes that if the government stays the course, the benefits could soon be visible.
“If the government succeeds in restoring economic stability, then 2026 could be the year we begin to see more spending, more infrastructure, and more opportunity,” he said.
Economists say this year will ultimately determine whether Ghana’s fiscal discipline in 2025 truly sets the stage for a stronger, more inclusive recovery, or whether the sacrifice of last year will feel like pain without payoff.
