Ghana’s economy is expected to experience greater external stability in 2025, with reserves projected to reach $8.8 billion by year-end, according to a report by Fitch Solutions. The country’s reserves had significantly declined between 2021-2023 due to rapid capital outflows driven by global risk aversion following Russia’s invasion of Ukraine, interest rate hikes in developed markets, and concerns about Ghana’s rising debt burden. However, reserves began recovering in 2024, hitting $6.4 billion by December, supported by a current account surplus, continued IMF disbursements, and reduced financial outflows.
Fitch Solutions anticipates further improvements in reserves in the coming months, aided by better investor sentiment following Ghana’s debt restructuring and a continued current account surplus. These factors are projected to boost reserves to $8.8 billion, or 3.5 months’ worth of imports, by the end of 2025.
Despite these positive developments, the report warns that Ghana’s external position remains vulnerable to exogenous shocks, particularly volatile commodity prices, such as gold. A stronger-than-expected US dollar or resolutions to conflicts in the Middle East and Ukraine could sharply lower gold prices, adversely affecting Ghana’s exports. Furthermore, while tariffs imposed by US President Trump may not significantly impact Ghana’s exports, they could dampen investor confidence in emerging markets, leading to capital outflows and straining Ghana’s foreign exchange liquidity.
