Mid-Year Budget Review Shows Signs of Stabilizing Economy

Ghana’s Minister for Finance, Dr. Cassiel Ato Forson, has presented the 2025 Mid-Year Budget Review to Parliament, outlining key fiscal improvements and economic stabilization efforts under the new administration.

According to the presentation, the government has revised its fiscal deficit projection downward from 4.5% to 3.8% of GDP, citing improved revenue collection, declining inflation, and renewed investor confidence.

“We are making cautious but real progress in restoring the health of the Ghanaian economy,” Dr. Forson told Parliament. “Our aim is to reduce the cost of living, revive critical sectors, and put Ghana back on a sustainable growth path.”

🧾 Key Budget Highlights:

• 📉 Inflation has dropped to 13.7% as of June 2025, down from 26.4% in January.

• 💰 Domestic revenue exceeded expectations in Q2, largely due to digital tax reforms and increased compliance enforcement by the GRA.

• 💸 Public debt-to-GDP ratio has stabilized around 67%, with debt restructuring talks ongoing under the IMF-supported framework.

• 🛠️ The government has increased funding for youth employment, agriculture modernization, and local manufacturing under the revamped Ghana CARES program.

🔁 Debt Relief & International Cooperation

The budget review also highlighted Ghana’s successful bilateral debt relief deal with France, the first under the Paris Club since restructuring negotiations began. Talks with other creditors — including China and Germany — are ongoing.

Dr. Forson assured the public that Ghana remains committed to transparency and fiscal responsibility under the $3 billion IMF Extended Credit Facility (ECF), which remains in place to support long-term economic reforms.

🚨 What’s Next?

The Finance Ministry announced plans to:

• Implement e-levy reform

• Improve targeting of social intervention programs

• Provide tax incentives for green energy and digital startups

Stakeholders have praised the review for being both “realistic and forward-looking,” though critics urge the government to tighten expenditure controls and expand the job market to ease pressure on households.