Ghanaians should brace for slower economic growth in 2025 as the government’s tough fiscal adjustments begin to bite, the World Bank Group has cautioned in its latest assessment of the economy.
The Bank’s 9th Ghana Economic Update, released in June, projects economic growth to slow to 3.9 percent in 2025, down from 5.7 percent in 2024, citing the impact of fiscal consolidation, high interest rates, and stubborn inflation.
While acknowledging the political stability and strong parliamentary majority of the Mahama-led administration as a unique opportunity to drive reforms, the Bank stressed that the coming year will test households and businesses alike.
“The corrective measures are necessary to restore stability,” the report said, “but they will require significant short-term sacrifices.”
Among the key reforms is the government’s target of achieving a primary surplus of 1.5 percent of GDP in 2025, aimed at creating fiscal space for critical investments. The World Bank noted that success here could unlock resources for pro-poor and growth-enhancing spending, but only if the measures are applied consistently.
Despite the overall slowdown, some sectors are expected to cushion the economy. Gold exports remain robust, supported by favourable international prices, while remittances—estimated at over $4 billion annually—and steady foreign direct investment are projected to sustain a current account surplus.
Inflation is forecast to ease gradually as the Bank of Ghana maintains a tight monetary stance, though the World Bank emphasised that debt sustainability remains contingent on completing external debt restructuring and sticking to fiscal discipline.
Although Ghana remains at high risk of debt distress, recent agreements with official creditors represent a breakthrough, giving the government breathing room as it gradually reduces reliance on external commercial borrowing.
The World Bank concluded that Ghana’s medium-term potential could return to around 5 percent growth, but only if the political will to see through painful reforms translates into consistent policy implementation.
