S&P upgrades Ghana’s Credit Rating Due to Economic Progress
Global credit rating agency S&P has upgraded Ghana’s sovereign credit ratings, raising both the long- and short-term foreign- and local-currency ratings to ‘B-/B’ from ‘CCC+/C’. The upgrade reflects significant improvements in Ghana’s fiscal management, external balances, and overall economic recovery. S&P has maintained a stable outlook on the country’s credit rating, indicating confidence in Ghana’s continued progress.
S&P also elevated Ghana’s transfer and convertibility assessment to ‘B-’ from ‘CCC+’, reflecting increased confidence in Ghana’s ability to manage foreign exchange flows and external obligations.
The upgrade reflects Ghana’s stronger balance of payments position and a gradual fiscal rebound, supported by sustained economic growth and favourable global prices for gold and cocoa, which together account for over 60% of the country’s exports.
S&P projects Ghana’s gross international reserves to rise to US$10.4 billion (9% of GDP) by the end of 2025, up from US$6.8 billion in 2024. Inflation, previously above 20%, is forecasted to decline below 10% from 2026, while the cedi has appreciated about 30% against the U.S. dollar since early 2025.
The ratings agency noted that Ghana’s new government, elected in December 2024, has introduced fiscal rules targeting a 1.5% primary surplus annually and a debt-to-GDP ratio of 45% by 2034. These reforms, alongside strengthened expenditure controls and procurement oversight, aim to prevent past fiscal slippages that harmed macroeconomic stability.
S&P praised Ghana’s progress in sovereign debt restructuring since its 2022 default. The government completed the domestic debt exchange program (DDEP) and the US$13.1 billion Eurobond restructuring in 2024. Negotiations are ongoing for the remaining US$5 billion owed to official and commercial creditors.
However, the agency warned that unresolved disputes with lenders, including the African Export-Import Bank (Afreximbank) and the Eastern and Southern African Trade and Development Bank (TDB), may delay finalizing debt restructuring.
S&P raised Ghana’s 2025 GDP growth forecast to 6.0% from 4.5%, citing diverse sector growth and increased investor confidence. The current account surplus is expected to reach a record 4.6% of GDP in 2025 before normalizing as commodity prices stabilize.
Despite the upgrade, S&P highlighted risks from high debt servicing costs, institutional weaknesses, and vulnerability to commodity price and climate shocks. The agency stressed that the success of fiscal reforms depends on maintaining discipline through a full electoral cycle, a period historically associated with fiscal slippages.
The stable outlook balances potential gains from improved fiscal and external metrics against risks from reform execution challenges and debt pressures.
A further upgrade could come from sustained fiscal discipline, increased foreign reserves, and resumed access to international capital markets. Alternatively, ratings could decline if fiscal consolidation falters, debt costs rise, or commodity prices fall sharply.
Ghana, after defaulting on external debt in December 2022, is implementing a US$3 billion IMF Extended Credit Facility (ECF) program running until May 2026, supporting fiscal reforms and macroeconomic stability.
S&P forecasts average real GDP growth of 5.6% annually through 2028, driven by better fiscal management, reduced inflation, and restored investor confidence.
