Cedi strengthens as fiscal discipline, debt deals drive Ghana’s recovery – World Bank

The Ghana cedi has firmed up on the exchange market in 2025, driven by tighter fiscal discipline and progress on debt restructuring.

This is according to the World Bank’s 9th Ghana Economic Update, which says the local currency’s rebound reflects stronger macroeconomic fundamentals.

Inflation, which stayed stubbornly above 20 percent throughout 2024, has begun to ease this year.

Ghana’s headline inflation rate fell to 12.1% in July 2025, down from 13.7% in June, marking the seventh consecutive month of decline and the lowest level recorded since October 2021, reinforcing investor confidence.

The World Bank points to spending restraint and the enforcement of new fiscal rules in the first half of 2025 as key signals of renewed discipline.

Debt restructuring has also provided relief. With the Eurobond exchange completed in late 2024 and an MoU signed with official creditors in January, Ghana is edging closer to restoring debt sustainability.

On July 25, 2025 Ghana and France have signed a bilateral agreement formalizing debt relief as part of Ghana’s ongoing external debt restructuring programme.

Talks with commercial creditors are still underway, but the Bank insists the trajectory is positive.

The external sector has added momentum, with gold exports, remittances, and stronger FDI flows lifting the current account into surplus and rebuilding reserves.

Still, the recovery faces headwinds. The World Bank projects GDP growth to slow to 3.9 percent in 2025 as fiscal consolidation tightens, before rebounding to 5 percent by 2028 on the back of private consumption, remittances, and new oil production.

The Bank warns that sustaining this momentum will require consistent revenue mobilisation, tighter expenditure controls, and deep reforms in troubled state enterprises such as COCOBOD and ECG.