The Minority Caucus in Parliament has welcomed the recent credit rating upgrade by Fitch Ratings, stating that it supports the New Patriotic Party’s (NPP) longstanding assertion that a robust economy was passed to the current administration.
Dr. Mohammed Amin Adam, the Ranking Member of the Finance Committee, noted that the upgrade highlights the strong economic foundation laid by the NPP, which he believes has fostered an environment for accelerated growth.
Fitch’s revised outlook for Ghana cites successful debt restructuring and improved fiscal indicators as key factors.
Nonetheless, the Minority warns that these achievements are overshadowed by concerns over the current government’s fiscal credibility and its ambitious budget targets.
The Minority emphasized that the recent upgrade is primarily attributed to the debt restructuring program finalized in 2024, particularly the agreement involving $13 billion with Eurobond holders.
“Ghana’s ability to meet debt obligations, due to a reduced debt stock, has been officially recognized, largely owing to the debt restructuring initiated by the NPP,” they asserted.
While acknowledging the current administration’s efforts to manage the remaining $2.6 billion in commercial debt, the Minority contends that the major groundwork was laid by the previous government.
They further noted that the debt restructuring has greatly enhanced Ghana’s debt sustainability outlook.
“The restructuring has resulted in a positive outlook by lowering medium to long-term debt payment obligations, effectively neutralizing the risk of debt default, which Fitch has cited as a reason for the upgrade,” they stated.
The Minority also recognized Fitch’s evaluation of strong macroeconomic indicators for 2024, including a projected current account surplus of 4.3 percent and a decline in inflation from 44 percent in 2022 to 18 percent by May 2025.
However, they raised significant concerns regarding the 2025 budget’s credibility.
“We are worried that the upgrade report raises serious doubts about the government’s economic management,” the Minority expressed.
They pointed out discrepancies between government targets and Fitch’s projections, such as the inflation target of 11 percent versus Fitch’s estimate of 15 percent for the year.
According to the Minority, this discrepancy puts Ghana’s ability to meet its IMF targets at risk and casts doubt on the reliability of the current budget assumptions.
They criticized the government’s revenue enhancement strategy, noting Fitch’s expectation that the debt service-to-revenue ratio will worsen from 25 percent in 2024 to 26 percent in the following years.
The Minority concluded that the upgrade could have been more substantial if the current administration had tackled existing fiscal risks.
They urged the government to revise the budget targets during the mid-year budget presentation in July 2025, emphasizing the need for accurate reflections of the economy’s state to avoid further undermining the budget’s credibility.
