Fitch upgrade reflects growth, yet discipline is essential — Analyst

By: Rebecca Okine

Economic analyst Emmanuel Boateng says Ghana’s recent credit rating upgrade by Fitch Ratings is a strong signal of improved debt management and macroeconomic stability, but warns that sustained discipline will be needed to consolidate the gains.

Fitch on Monday, June 16, 2025, upgraded Ghana’s Long-Term Foreign-Currency Issuer Default Rating (IDR) from ‘Restricted Default’ to B- with a Stable Outlook.

The decision followed Ghana’s successful restructuring of over USD13.1 billion in Eurobond debt, which forms part of a broader effort to recover from its 2022 sovereign default. Fitch cited improving debt sustainability, declining inflation, a stabilized currency, and stronger foreign reserves as key drivers of the upgrade.

Speaking on the Business Breakfast on Zed, Mr. Boateng said the exchange rate has been a critical factor in easing Ghana’s external debt burden.

“The movement of our exchange rate has an implication for our debt, so once we’ve been able to bring it down, now it is stable,” he said.

He noted that exchange rate stability has also helped ease inflationary pressures, particularly on imported goods.

“The recent stability we have seen with the exchange rate has eased the pressure on imported food and reduced the hike in inflation that we have seen in the past,” Mr. Boateng explained.

The analyst stressed the need for continued coordination between monetary and fiscal authorities, pointing to the role of the Bank of Ghana and the Ministry of Finance in achieving recent stability.

“The government can implement monetary policy that’s focused on price stability, reducing inflation, potentially through collaboration with the Bank of Ghana,” he added.

Mr. Boateng also highlighted the importance of targeted government spending, warning against borrowing for non-productive uses.

“Don’t borrow money and spend that money on consumption; spend that money on projects that are able to generate income to help with the economic progress of this country,” he advised.

Mr. Boateng added that managing foreign reserves is vital for protecting the economy against external shocks. He explained that Ghana’s external debt remains more significant than its domestic obligations, making reserve management and exchange rate policies central to long-term stability.

While the credit rating upgrade marks a positive step forward, Mr. Boateng cautioned that Ghana must stay the course on fiscal and monetary reforms.