Within a period of 12 months, Ghana has been able to shed a whopping 16.5 percentage points of its debt to GDP, signaling how the government’s debt reduction efforts are yielding results.
This means that on average, Ghana has shed off about 1.4percentage points of its debt to GDP every month within the 12-month period.
To put it simply, Ghana in December 2024 was walking around with a 62kg backpack of debt and suddenly, it has reduced to 45kg. This means that the country is now breathing easier, walking faster, and is more optimistic about the journey ahead.
According to the latest Summary of Economic and Financial Data from the Bank of Ghana, the nation has successfully executed a massive “fiscal trim,” bringing its total public debt down from a heavy 61.8% of GDP in December 2024 to a much leaner 45.3% by December 2025.
The Fall
Experts explain that this dramatic year-on-year drop of 16.5 percentage points represents a fundamental shift in the country’s financial health.
The data cited by The High Street Journal notes that while the debt stock stood at GHC 726.7 billion at the end of 2024, it was managed down to GHC 641.0 billion by the end of 2025.
This success was punctuated by a strong finish in the final month of the year, as the debt-to-GDP ratio edged down from 45.5% in November to the final 45.3% in December 2025.
In dollar terms, although the public debt stock stood at US$49.4 billion in December 2024, it stood at US$61.3 billion in December 2025. This nominally higher stock, but smaller debt stock, is an indication of the impact of the cedi’s appreciation on the country’s debt.
A Tale of Two Fronts: External vs. Domestic
The battle to reduce the debt burden is fought on two distinct fronts.
The external component of the debt recorded a significant victory. In December 2024, foreign debt accounted for 35.4% of GDP. By December 2025, that figure had plummeted to 21.7%.
This indicates that the country’s strategies to manage foreign obligations and perhaps benefit from a more stable currency environment (with the USDGHC rate ending the year at 10.45) are paying off.
The domestic component also saw a year-on-year improvement, falling from 26.3% of GDP in 2024 to 23.6% in December 2025.
It is worth noting, however, that the domestic front saw a slight “holiday bulge” in the final month, rising from 22.2% in November to 23.6% in December, as the government likely tapped local markets to close out the year
Why the Strategy is Working
This easing of the debt burden is a clear signal that Ghana’s debt reduction strategies, including the aftermath of the Domestic Debt Exchange Programme (DDEP) and disciplined fiscal operations, are yielding tangible results.
In addition, the significant appreciation of the cedi cannot be discounted, as it has reduced the value of the dollar-denominated debt.
Moreover, by keeping the annual nominal GDP growing, rising to an estimated GHC 1,400 billion in 2025, the government has effectively increased the size of the “economic pie,” making the debt slice appear much smaller and more manageable.
What This Means for You
For the average Ghanaian and business owner, a lower debt-to-GDP ratio is more than just a government win.
It signals reduced fiscal pressure, which often leads to the lower interest rates we are currently seeing, with the 91-Day Bill dropping from 26.93% in early 2025 to a significantly lower 11.08% by December.
As the country sheds its heavyweight debt title, the focus now shifts to how this declining debt could be sustained. If these strategies hold, the days of the suffocating debt cloud may finally be retreating.
