Ghana’s parliament has approved a Ghc357.1-billion (US$31 billion) budget for the 2026 fiscal year, clearing the government’s spending plan after weeks of often heated debate over fiscal discipline and debt management.
Lawmakers passed the appropriation bill on Friday following six weeks of deliberations on the budget statement presented on November 13 by Finance Minister Cassiel Ato Forson. The approval authorises total government expenditure for 2026 as Ghana continues efforts to stabilise its economy after years of high debt and inflationary pressures.
Speaking during the debates in the Parliament of Ghana, Forson said the government had managed the economy prudently, pointing to tighter controls on spending and improved debt management. He stressed that the administration had avoided borrowing from the central bank, a practice that in the past fuelled inflation and currency weakness.
The passage of the budget comes against the backdrop of renewed support from international partners. Earlier in the week, the Executive Board of the International Monetary Fund approved the fifth review of Ghana’s economic reform programme under the Extended Credit Facility. The decision unlocks an immediate disbursement of $385 million to support the country’s economic recovery and balance-of-payments needs.
In a statement, the IMF said Ghana’s performance under the programme had been “generally satisfactory,” despite challenges over the past year. The Fund noted that the authorities demonstrated strong ownership of the reforms by implementing corrective measures following policy slippages in 2024.
“These actions have helped restore macroeconomic stability and rebuild confidence,” the IMF said, adding that continued fiscal discipline and structural reforms would be essential to sustain the recovery.
Ghana entered the IMF programme in 2023 after a severe economic crisis marked by surging inflation, a sharp depreciation of the cedi and rising public debt. Since then, the government has implemented spending cuts, tax measures and debt restructuring, while seeking to protect social spending and priority investments.
The 2026 budget is expected to focus on consolidating recent gains, supporting growth and maintaining fiscal restraint as the country gradually exits crisis mode. Analysts say parliamentary approval sends a positive signal to investors and development partners, although the challenge of translating budget commitments into tangible improvements in living standards remains significant.
The budget was passed in Accra, the capital, as Ghana continues to balance economic recovery with political pressures ahead of future elections.
Ghana’s parliament has approved a 357.1 billion cedi ($31 billion) budget for the 2026 fiscal year, clearing the government’s spending plan after weeks of often heated debate over fiscal discipline and debt management.
Lawmakers passed the appropriation bill on Friday following six weeks of deliberations on the budget statement presented on November 13 by Finance Minister Cassiel Ato Forson. The approval authorises total government expenditure for 2026 as Ghana continues efforts to stabilise its economy after years of high debt and inflationary pressures.
Speaking during the debates in the Parliament of Ghana, Forson said the government had managed the economy prudently, pointing to tighter controls on spending and improved debt management. He stressed that the administration had avoided borrowing from the central bank, a practice that in the past fuelled inflation and currency weakness.
The passage of the budget comes against the backdrop of renewed support from international partners. Earlier in the week, the Executive Board of the International Monetary Fund approved the fifth review of Ghana’s economic reform programme under the Extended Credit Facility. The decision unlocks an immediate disbursement of $385 million to support the country’s economic recovery and balance-of-payments needs.
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In a statement, the IMF said Ghana’s performance under the programme had been “generally satisfactory,” despite challenges over the past year. The Fund noted that the authorities demonstrated strong ownership of the reforms by implementing corrective measures following policy slippages in 2024.
“These actions have helped restore macroeconomic stability and rebuild confidence,” the IMF said, adding that continued fiscal discipline and structural reforms would be essential to sustain the recovery.
Ghana entered the IMF programme in 2023 after a severe economic crisis marked by surging inflation, a sharp depreciation of the cedi and rising public debt. Since then, the government has implemented spending cuts, tax measures and debt restructuring, while seeking to protect social spending and priority investments.
The 2026 budget is expected to focus on consolidating recent gains, supporting growth and maintaining fiscal restraint as the country gradually exits crisis mode. Analysts say parliamentary approval sends a positive signal to investors and development partners, although the challenge of translating budget commitments into tangible improvements in living standards remains significant.
The budget was passed in Accra, the capital, as Ghana continues to balance economic recovery with political pressures ahead of future elections.
Background on Ghana’s economy
Ghana’s economy is one of the most diversified in West Africa, built on a mix of natural resources, agriculture, services and a growing industrial base. For decades after independence, the country relied heavily on exports of cocoa and gold, before crude oil production began in commercial quantities in 2010, adding a new pillar to growth and government revenue.
Structure of the economy
Today, services account for more than half of Ghana’s gross domestic product, driven by trade, transport, finance, telecommunications and public administration. Industry—comprising mining, oil and gas, construction and manufacturing—contributes roughly a quarter of output, while agriculture employs the largest share of the labour force, despite its smaller GDP contribution.
Ghana is the world’s second-largest producer of cocoa and one of Africa’s top gold exporters. Crude oil production, mainly from offshore fields such as Jubilee and TEN, has helped boost export earnings, though output has fluctuated in recent years due to declining fields and investment constraints.
Growth and vulnerability
For much of the past two decades, Ghana was regarded as a regional economic success story, recording periods of strong growth, particularly after oil came on stream. However, the economy has also been highly exposed to external shocks. Dependence on commodity exports makes growth vulnerable to swings in global prices, while heavy reliance on imports—especially fuel, food and manufactured goods—puts pressure on foreign exchange reserves.
Fiscal slippages, rising public sector wages, energy-sector debts and repeated election-related spending have contributed to persistent budget deficits. These imbalances were exacerbated by the COVID-19 pandemic and later by global inflationary pressures following Russia’s invasion of Ukraine, which sharply increased fuel and food costs.
Debt and inflation crisis
By 2022, Ghana faced a full-blown macroeconomic crisis marked by surging inflation, rapid depreciation of the cedi and unsustainable public debt. Inflation peaked above 50 percent, while debt servicing absorbed a growing share of government revenue. In response, the government suspended payments on most external debt and launched a domestic debt exchange programme, which restructured local bonds held by banks, pension funds and individual investors.
The crisis prompted Ghana to seek support from the International Monetary Fund, leading to a multi-year Extended Credit Facility programme aimed at restoring macroeconomic stability. The programme focuses on fiscal consolidation, debt sustainability, revenue mobilisation and reforms in the energy and public financial management sectors.
Reform and recovery
Since entering the IMF programme, Ghana has made progress in stabilising key indicators. Inflation has eased from its peak, the exchange rate has shown periods of stability, and fiscal controls have been tightened. The government has prioritised avoiding central bank financing of deficits, a key source of past inflation.
Debt restructuring talks with bilateral and commercial creditors are ongoing, with the aim of reducing the debt burden and freeing up resources for development spending. While the process has been complex and at times protracted, it is central to Ghana’s medium-term recovery prospects.
Outlook
Ghana’s medium-term economic outlook hinges on maintaining reform momentum, boosting domestic revenue, and reviving growth in productive sectors such as agriculture, manufacturing and energy. Unlocking value addition in cocoa, gold and oil, alongside leveraging regional trade opportunities under the African Continental Free Trade Area, could strengthen resilience.
However, challenges remain. High living costs, unemployment pressures—especially among youth—and limited fiscal space continue to test policymakers. Sustained discipline, credible reforms and improved governance will be critical if Ghana is to translate macroeconomic stabilisation into inclusive and durable growth.
