The government is set to introduce a fiscal responsibility rule that will place a ceiling on the country’s debt as part of efforts to enforce fiscal discipline and restore macroeconomic stability.

This was disclosed by the Finance Minister, Dr. Cassiel Ato Forson, during a high-level engagement with over 22 Managing Directors of banks on Thursday, March 20, 2025.

In a social media post following the meeting, Dr. Forson stated, “As part of our commitment to fiscal discipline, we will be submitting to Parliament a fiscal responsibility rule—a debt ceiling that the Ministry of Finance cannot exceed.” This measure is expected to serve as a critical tool in preventing excessive borrowing and ensuring long-term economic stability.

The Finance Minister further emphasized the government’s resolve to achieve fiscal consolidation through significant spending cuts.

“We are making massive investment cuts and resetting goods and services expenditure to 2023 levels. Our target is clear: achieve a primary surplus of 1.5% as we work to consolidate our gains and rebuild confidence.”
Dr. Cassiel Ato Forson

This fiscal tightening comes in the wake of Ghana’s ongoing economic recovery efforts after a period of financial turbulence. The government’s decision to reset spending to 2023 levels underscores its commitment to prudent financial management while ensuring that essential public services continue to be funded effectively.

Domestic Debt Exchange Programme (DDEP) Commitments

Addressing concerns about Ghana’s Domestic Debt Exchange Programme (DDEP), Dr. Forson assured stakeholders that the government remains committed to honoring its obligations and has no plans to default. “We do not intend to default. All outstanding holdouts have been paid, and we have built enough buffers to fully meet our DDEP obligations this year,” he emphasized.

This assurance is aimed at restoring investor confidence following the debt restructuring process, which initially raised concerns about Ghana’s financial stability. The Minister’s reaffirmation is likely to provide reassurance to both domestic and international creditors.

Dr. Forson also outlined steps the government is taking to reduce its dependence on Treasury bills, which have traditionally been a significant source of short-term borrowing for the state.

“We are also taking deliberate steps to reduce our reliance on the Treasury bill market and strengthen policy coordination between fiscal and monetary authorities. Stability is our priority, and we will not return to the turbulence of 2022. We will not be reckless.”
Dr. Cassiel Ato Forson

The move to curb reliance on short-term debt instruments aligns with broader efforts to stabilize Ghana’s financial landscape and prevent a recurrence of the fiscal challenges experienced in recent years. Enhancing coordination between fiscal and monetary policies is expected to create a more predictable economic environment, boosting investor confidence and financial sector resilience.

Strengthening Collaboration with the Banking Sector

Recognizing the pivotal role of the banking industry in Ghana’s economic recovery, Dr. Forson reaffirmed the government’s commitment to working closely with financial institutions. The meeting, attended by key banking sector players, provided an opportunity to discuss the way forward for economic recovery and financial sector stability.

Also present at the meeting was the newly appointed Governor of the Bank of Ghana, Dr. Johnson Asiama, who is preparing to chair his first Monetary Policy Committee (MPC) meeting next week. His presence, alongside his deputy, was highlighted by Dr. Forson as a demonstration of the renewed synergy between fiscal and monetary authorities.

The President of the Ghana Association of Banks (GAB) and CEO of Stanbic Bank Ghana, Mr. Kwamina Asomaning, commended the government’s 2025 budget, noting that it had been well received by the market. He pledged the banking sector’s support in advancing financial inclusion and capital market development.

The introduction of a debt ceiling, coupled with disciplined fiscal policies and financial sector collaboration, marks a decisive step towards stabilizing Ghana’s economy.