Ghana has posted its first primary budget surplus since March 2024, with the figure turning positive at 0.3% of GDP in March 2025, according to the latest fiscal data. This marks a significant milestone in the country’s efforts toward fiscal consolidation and reflects a gradual return to budgetary discipline following months of persistent deficits.
The primary balance, which excludes interest payments from government expenditures, is a critical gauge of underlying fiscal health. Ghana’s primary balance had remained negative for twelve consecutive months, reaching its deepest point at −2.8% between August and September 2024. However, since then, the government has steadily narrowed the gap, from −2.2% in October and November, to −1.2% by December, before finally breaking even and turning positive in March 2025.
This improvement can be attributed to a combination of increased domestic revenue and tighter expenditure controls. For instance, domestic revenue rose to 3.0% of GDP in March 2025, up from just 0.9% in January. Tax revenue also improved, growing from 0.8% of GDP in January to 2.6% by March. Meanwhile, capital expenditure has remained modest at just 0.3% of GDP in March, suggesting a deliberate effort to limit non-essential spending.
On the expenditure side, although total spending increased slightly to 4.0% of GDP in March, it was outweighed by the stronger revenue performance. This shift enabled the government to meet non-interest obligations without excessive reliance on new debt, reflected in the declining net domestic financing, which dropped to 1.1% in March, down from 1.5% in February.
While the overall balance remains in deficit at −1.0%, the turnaround in the primary balance indicates growing control over the country’s fiscal path and a potential buildup of credibility with both investors and international partners.
Maintaining this surplus will be crucial, especially as Ghana heads into the second quarter of 2025.
