Mahama’s First Media Test: Key Issues Unveiled
A Vision for Economic Stability and Growth
President John Mahama recently addressed the media, offering a detailed overview of Ghana’s economic progress and future plans. His speech, delivered at the Presidential Villa in Accra, marked a significant moment in his second term, highlighting both achievements and cautious optimism.
The president began by acknowledging the early signs of economic recovery, citing recent data from the Ghana Statistical Service. He noted that the economy had grown by 6.3% in the second quarter of 2025, with inflation reaching its lowest level in nearly four years. Additionally, the Cedi had appreciated significantly, becoming one of the world’s best-performing currencies in 2025. President Mahama credited the government’s fiscal consolidation policies and successful debt restructuring efforts for these positive developments.
Economic Performance and Fiscal Discipline
Ghana’s economic trajectory has been shaped by various macroeconomic targets set by previous governments. For instance, the 2024 budget aimed for a real GDP growth of at least 2.8%, with a medium-term average of 4.3% for 2024-2027. The government also focused on achieving a primary balance surplus of 0.5% of GDP. However, concerns about the high debt-to-GDP ratio, projected to be around 70.5% in late 2024, remained a critical issue.
In 2025, key economic indicators have shown impressive performance. The provisional real GDP growth rate for Q1 2025 was 5.3%, up from 4.9% in Q1 2024. This growth was driven by strong performance in the non-oil sector, particularly agriculture, services, and manufacturing. By Q2 2025, the economy continued to expand, with a growth rate of 6.3%, primarily due to the services sector.
The public debt-to-GDP ratio has also seen a significant decline, dropping from 61.8% at the end of December 2024 to 43.8% by the end of June 2025. This reduction is attributed to effective fiscal consolidation policies and the appreciation of the Cedi. Gross international reserves have also increased, reaching $11.1 billion by the end of June 2025, covering approximately 4.0 months of imports.
Caution on External Borrowing
Despite these positive developments, President Mahama has taken a cautious stance on returning to the international capital market. He emphasized the need to consolidate economic gains before considering external borrowing. “We have demonstrated that Ghana can be run without relying on the capital market,” he stated, highlighting the country’s survival without a Eurobond in recent years. This approach reflects a broader strategy to rebalance external financing away from debt toward more stable foreign direct investment.
Focus on Export-Led Growth
Looking ahead, President Mahama reiterated his commitment to the “Resetting Ghana Agenda,” with a focus on the “24-hour economy” and export-led growth. The 24-hour economy aims to encourage businesses and public institutions to operate around the clock, boosting production, productivity, and job creation. This initiative is designed to transform Ghana into an import-substitution and export-led economy.
The Bank of Ghana has also adjusted its monetary policy rate in response to a sustained disinflationary trend. In March 2025, the Monetary Policy Committee (MPC) raised the policy rate to 28.0%. In July 2025, the MPC reduced the policy rate by 300 basis points to 25.0%, citing a decline in inflation and stronger economic activity. A further reduction may be considered if the disinflation trend continues.
Infrastructure Development and Debt Management
Infrastructure development remains a key focus of the government’s economic agenda. The “Big Push Infrastructure Programme” has led to significant road projects across the country. Key ongoing projects include the Accra-Kumasi Highway Bypass, Nsawam-Ofankor Dualization, Tema Motorway Roundabout, and Western North Region Roads. These projects aim to improve connectivity and support economic growth.
A major challenge facing the road sector has been the significant debt owed to contractors. In 2025, the government took steps to address this issue through Debt Audits, aiming to clear a total debt of about GH¢21 billion owed to contractors. The government has committed to settling payments within two weeks of submission, ensuring prompt payment to contractors.
The Minister for Roads and Highways, Kwame Governs Agbodza, announced in July 2025 that the government would disburse an amount of GH¢4 billion to road contractors to settle part of the outstanding debt. These expenditures are expected to boost economic transactions in the country, contributing to the upward trajectory of GDP growth in 2025.
Conclusion
President Mahama’s address painted a picture of a government confident in its economic strategy but cautious about the pitfalls of past borrowing. The focus on fiscal discipline, a lean government, and a private-sector-led export drive appears to be central to his second-term economic policy. With a strong emphasis on infrastructure development and prudent fiscal management, Ghana is well-positioned for sustained economic growth.