Global Economic Downturn, Debt Pose Major Risk to Ghana – Analyst

By: Solomon Nartey Tetteh

Economic Analyst Emmanuel Boateng has warned that Ghana remains highly exposed to the risk of a global economic downturn and rising debt levels over the next two years, describing the outlook as particularly concerning for emerging economies. He made the remarks following the World Economic Forum’s Global Risks Report, which identifies economic instability and debt distress as among the most pressing threats over the next two years, with emerging economies facing heightened risks.

Speaking on Business Breakfast on Zed 101.9FM, Mr. Boateng said the structure of Ghana’s economy, especially its heavy reliance on export revenues poses a significant risk to the country, cautioning that volatility in the global economic environment could be swiftly transmitted into the domestic economy. He explained that the report categorises risks based on their immediacy over the next two years, as well as their potential severity over a ten-year horizon.

According to him, economic downturn has climbed sharply in global rankings, jumping eight positions to 11th place.

“That alone tells you how serious the situation is becoming globally, and for Ghana, this is something we cannot ignore,” he said.

Mr. Boateng noted that Ghana is gradually emerging from its IMF-supported program, but cautioned that the country’s debt-to-GDP ratio remains elevated. He stressed that debt sustainability remains a major challenge, while acknowledging that debt indicators have improved compared to the period before the program.

The analyst pointed out that the report warns of mounting debt sustainability concerns worldwide, coupled with the risk of economic bubbles, all within the context of rising geoeconomic tensions.

He said these factors could usher in a new phase of global volatility, with significant implications for vulnerable economies like Ghana.

Mr. Boateng highlighted the structure of Ghana’s economy, particularly its heavy dependence on export revenues.

He warned that any volatility in the global economic environment would quickly transmit into the domestic economy.

“As long as we remain highly dependent on exports, especially primary commodities, global shocks will continue to affect us disproportionately,” he said.

Mr. Boateng reiterated the need for urgent economic diversification, stressing that Ghana must move away from the export of raw primary commodities to higher value-added products. According to him, successful diversification across this spectrum would help insulate the economy from external shocks and reduce Ghana’s vulnerability to future global downturns.