Accra: President John Dramani Mahama has unveiled a comprehensive strategy by the Government to reopen both domestic and international capital markets. In his address at the 2025 Ghana CEOs’ Summit in Accra, he emphasized the collaboration with the International Monetary Fund (IMF), development partners, the Ghana Stock Exchange, and local banks to achieve this goal.

According to Ghana News Agency, President Mahama highlighted that future borrowing would be tied to self-financing commercially viable projects, particularly by Ministries, Departments and Agencies (MDAs), Metropolitan, Municipal and District Assemblies (MMDAs), and State-Owned Enterprises (SOEs). This approach aims to ensure value for money and sustainable repayment.

Ghana has encountered significant challenges in recent years, including a loss of access to international financial markets and an increasing reliance on treasury bills for funding. These issues led to the implementation of policies such as debt restructuring and fiscal consolidation to address the financial difficulties.

Reflecting on the period between 2013 and 2016, President Mahama noted that his previous administration made significant efforts to enhance Ghana’s domestic and external financial markets. Under the guidance of Finance Ministers like Dr. Kwabena Duffour and Mr. Seth Terkper, and in collaboration with the Central Bank and commercial banks, they introduced medium and long-term domestic bonds and listed them on the Ghana Stock Exchange. They also established the Central Securities Depository to improve transparency and liquidity.

Moreover, Ghana became one of the few African nations to issue a $200 million denominated domestic bond, which was oversubscribed, supporting the smart borrowing initiative. Additionally, from 2013 to 2016, Ghana issued four euro bonds, successfully avoiding default, and anchored them in a sinking fund mechanism to ensure repayment.

Before leaving office on January 7, 2017, President Mahama’s administration left sufficient reserves, enabling the subsequent administration to pay off the balance of the 2007 bond in 2017 without distress. However, he lamented that between 2017 and 2022, debt accumulation surged, and the framework for ensuring repayment was dismantled, leading to Ghana’s default on both domestic and external debts.

The consequences were severe, with investors, businesses, and pensioners suffering losses through the domestic debt exchange program, and Ghana’s creditworthiness downgraded to junk status. Public sector arrears increased, and small and medium enterprises (SMEs) struggled to access credit.

President Mahama criticized poor fiscal management and opaque practices as significant contributors to these challenges and emphasized the need for a true reset by learning from the past. He outlined eight key pillars for economic recovery, starting with the completion of the IMF program with disciplined government expenditure and borrowing.

With a target to conclude the Fourth Review of the IMF program by June 2025 and exit the program by 2026, Ghana aims to engage responsibly with the IMF through Article 4 Consultations and the policy support instrument framework, signaling a return to responsible financial management.