Ghana’s 2028 Debt Wall: Can the Recovery Survive the Refinancing Test?

By Prof. Samuel Lartey

Introduction

Ghana may have escaped the most dangerous phase of its debt crisis, but it has not escaped the mathematics of debt.

The International Monetary Fund’s latest assessment presents what appears at first to be a paradox. Ghana’s macroeconomic indicators have improved substantially. Real GDP grew by 6 percent in 2025 and by 6.4 percent in the first quarter of 2026. Inflation declined to 5.3 percent in June 2026. The primary fiscal balance moved into surplus, international reserves strengthened, and the IMF upgraded Ghana from high to moderate risk of debt distress. Yet the Fund is simultaneously warning that domestic debt vulnerabilities remain significant.

The reason is simple but economically important. Debt sustainability is not only about how much a country owes. It is also about when the debt must be paid, how frequently it must be refinanced, who is expected to finance it, and at what cost.

Ghana now faces a potentially difficult refinancing period in 2027 and 2028. The IMF projects elevated gross financing needs, with pressure peaking above 16 percent of GDP in 2028. At the same time, large volumes of bonds created under the Domestic Debt Exchange Programme fall due, Treasury bills remain central to Government financing, and banks and other financial institutions continue to hold substantial Government securities.

This creates Ghana’s next economic test: can the country move from debt restructuring to disciplined debt management without allowing Government financing requirements to crowd out businesses, weaken investment or squeeze households?

The Debt Crisis Has Changed Form

During the 2022 crisis, Ghana’s problem was fundamentally one of debt sustainability, market access and confidence. Gross financing needs reached 19.5 percent of GDP in 2022, considerably above the IMF and World Bank market financing risk benchmark of 14 percent used in their debt analysis. Domestic debt service accounted for about 81.7 percent of public debt service at the time.

The Domestic Debt Exchange Programme subsequently altered the structure and repayment profile of much of that debt. That restructuring created breathing space, but it did not make the obligations disappear. It largely shifted payments into the future. The future is now approaching.

Ghana therefore faces a transition from one economic question to another.

In 2022, the question was: Can Ghana restructure its debt?

In 2027 and 2028 the question becomes: Can Ghana refinance and redeem that restructured debt without creating another fiscal and financial crisis?

The Numbers Behind the Warning

The IMF’s public sector financing projections illustrate the scale of the challenge.

1. Gross financing needs

The IMF projects gross financing requirements of about GH¢189.3 billion in 2026. They rise to GH¢259.4 billion in 2027 and GH¢323.3 billion in 2028.

That represents an increase of approximately 37 percent between 2026 and 2027, followed by another 24.6 per cent between 2027 and 2028.

Across the two years, Ghana’s projected gross financing requirement increases by roughly 70.8 percent, from GH¢189.3 billion to GH¢323.3 billion.

This is important because gross financing needs are broader than the fiscal deficit. They essentially capture the money Government must find not only to finance any budgetary shortfall but also to repay or refinance debt falling due.

A country can therefore have an improving fiscal deficit while still facing enormous financing pressure because previously issued debt is maturing.

2. Domestic debt service

The domestic component of projected debt service rises from about GH¢154.5 billion in 2026 to GH¢225.5 billion in 2027 and GH¢285.1 billion in 2028.

That represents an increase of approximately 84.5 percent between 2026 and 2028.

The calculation demonstrates why the IMF remains concerned even though Ghana’s overall debt ratio is declining.

3. Public debt trajectory

The positive side of the story is that the IMF projects gross public debt at about 52.6 percent of GDP in 2026, declining to 51.7 percent in 2027, 50.6 percent in 2028 and eventually 48 percent by 2031. Ghana is also targeting a longer-term debt anchor of 45 percent of GDP by 2034.

Thus, Ghana is confronting a liquidity and refinancing problem inside an improving solvency framework.

That distinction is critical.

Treasury Bills: Solution Today, Risk Tomorrow

Treasury bills provide the Government with flexible domestic financing. They are relatively simple instruments and can attract banks, pension funds, investment funds, businesses and individuals.

But Treasury bills are short-term instruments. The Government must return to investors repeatedly to refinance them.

This creates rollover risk.

If GH¢5 billion of Treasury bills mature and investors reinvest the GH¢5 billion, the rollover succeeds.

If investors suddenly become willing to reinvest only GH¢3 billion, Government must find GH¢2 billion elsewhere, reduce expenditure, offer higher interest rates or use another financing mechanism.

The Banking Sector and the Sovereign Debt Connection

One of the IMF’s strongest warnings concerns the relationship between Government and Ghana’s financial institutions. Banks naturally hold sovereign securities as part of liquidity management. The danger arises when Government securities become excessively dominant.

A bank deciding between lending GH¢10 million to a manufacturing company and investing GH¢10 million in Government securities compares risk, expected return, liquidity, capital requirements and administrative costs.

Government paper generally requires no factory inspection, business plan assessment, collateral perfection or loan recovery operation.

If Government borrowing becomes continuously large and attractive, banks may have less incentive to lend to productive enterprises.

That is the crowding out effect.

Impact on Government Initiatives

The refinancing challenge could have major implications for Ghana’s development programme.

First, large debt repayments compete with infrastructure, agriculture, education, health, industrialisation and social protection for fiscal resources.

Second, setting aside revenue for future debt repayment improves credibility but reduces the amount of immediately spendable revenue.

Third, heavy borrowing can undermine Government programmes designed to create jobs if businesses cannot obtain affordable financing to participate in those programmes.

The World Bank provides an important illustration. As at March 2026, its Ghana portfolio contained about US$4.29 billion in commitments. However, expenditure limitations associated with fiscal consolidation had significantly slowed externally financed capital expenditure and affected disbursements on several projects.

Debt discipline must not become development paralysis.

Impact on Businesses

For businesses, the principal risk is the availability and cost of capital. When banks allocate increasing proportions of their balance sheets to Government securities, businesses may experience tighter credit conditions.

SMEs are particularly vulnerable because many cannot issue bonds or shares directly to investors. Bank credit and retained profits remain their primary financing sources.

There is already evidence that private investment can generate measurable economic returns. The World Bank reports that the Ghana Economic Transformation Project has facilitated about US$245.86 million in private investment, while supported firms recorded an average 18 percent increase in gross sales and generated 2,438 direct jobs.

The lesson is straightforward. Every cedi that migrates sustainably from financing consumption or repeated refinancing towards productive enterprise can potentially increase output, employment, exports and future tax revenue.

What Ghana Must Do Before 2028

The warning provides Ghana with something it did not adequately possess before the 2022 crisis: time to prepare.

The policy priorities should consequently be clear.

1. Lengthen domestic debt maturities gradually. Ghana must move from excessive dependence on Treasury bills towards a balanced maturity structure without suddenly overwhelming the bond market.

2. Build the sinking fund transparently. The 7 per cent earmarking of non-oil tax revenue should be subject to rigorous reporting, disclosure and parliamentary oversight so that money accumulated for future redemptions remains protected.

3. Protect fiscal discipline. The 2026 budget targets a primary surplus of 1.5 per cent of GDP. The IMF considers continued fiscal discipline essential to preserving the improved debt trajectory.

4. Protect productive expenditure. Fiscal consolidation should prioritise expenditure efficiency rather than indiscriminate expenditure compression, particularly where infrastructure and human capital investments can expand future GDP and revenues.

5. Create space for private credit. Falling sovereign rates should translate increasingly into cheaper financing for agriculture, manufacturing, technology, exports, construction and SMEs.

Conclusion

Ghana’s economic recovery is real, but recovery and resilience are not the same thing.

The country has moved from an acute debt crisis towards an improved debt trajectory. Inflation has declined dramatically. Growth has strengthened. International reserves have recovered. Fiscal balances have improved. The risk of debt distress has moved from high to moderate. These are significant achievements.

But the IMF’s warning about 2027 and 2028 should prevent premature celebration.

A projected rise in gross financing needs from about GH¢189.3 billion in 2026 to GH¢323.3 billion in 2028 means that Ghana must prepare for a refinancing requirement roughly 71 per cent larger within only two years. Domestic debt service alone is projected to approach GH¢285 billion in 2028.

The country therefore needs to transform its debt philosophy.

Borrowing must increasingly finance production rather than perpetually refinance borrowing.

Government securities must coexist with vibrant corporate financing. Banks must become stronger financiers of enterprise. Pension and investment funds need broader productive investment opportunities. Fiscal policy must protect growth-creating expenditure. Revenue must increasingly come from a larger and more productive economy.

The central lesson from Ghana’s debt crisis should be remembered when the DDEP maturity wall arrives: a debt exchange can rearrange the calendar, but only fiscal discipline, economic growth, productive investment and credible debt management can change the destination.

Ghana survived the restructuring test.

The 2027 and 2028 refinancing test will determine whether the country truly learned from it.

I can also monitor the IMF, Ministry of Finance and Bank of Ghana and alert you when there are major changes to Ghana’s 2027 and 2028 refinancing strategy or debt projections.