The International Monetary Fund (IMF) has warned the Government of Ghana against rushing back to the international capital markets, cautioning that a repeat of the “excessive and expensive borrowing” of the past could derail the country’s fragile economic recovery.
With the 2026 national budget due in two weeks, the IMF’s Resident Representative in Ghana, Dr. Adrian Alter, urged the government to remain extremely prudent in its financing decisions and to rely on concessional loans from multilateral partners such as the World Bank, African Development Bank, and the IMF itself.
Speaking on Channel One TV’s Point of View with Bernard Avle, Dr. Alter noted that although global financial conditions have slightly improved, borrowing on international markets would still attract prohibitive rates — likely above 10 percent interest, given Ghana’s current credit rating.
“We have advised the government to be extremely prudent — not to repeat past mistakes of excessive borrowing. When concessional financing is available from multilateral agencies, it makes little sense to turn to international markets where rates are extremely pricey,” he said.
Dr. Alter stressed that borrowing costs remain punishing for emerging economies like Ghana, making any return to the Eurobond market risky under present conditions.
He explained that under the ongoing IMF-supported programme, Ghana faces strict limits on new external borrowing to safeguard debt sustainability. The country is expected to maintain a 70:30 financing mix — 70 percent domestic, 30 percent external — in line with the IMF’s debt sustainability framework and agreements with creditors.
> “On the domestic market, we’ve worked closely with the government to start lengthening bond maturities beyond one year,” Dr. Alter added. “We hope that by early next year, conditions will allow the domestic bond market to reopen.”
Ghana has remained locked out of international capital markets since its 2022 debt default, when the government suspended payments on most external debt to stabilise the economy. That move eroded investor confidence and cut off access to new global financing.
The country is currently implementing a $3 billion IMF programme aimed at restoring macroeconomic stability after years of widening deficits, ballooning debt, and soaring inflation forced a debt restructuring in 2023.
The programme seeks to restore debt sustainability, rebuild foreign reserves, and promote inclusive growth — objectives that could be jeopardised by a premature and costly re-entry into the global markets.
