By Surv. Prof. Forster SARPONG
During the first quarter of 2025, Ghana reached a significant and uncommon economic achievement, attaining a net lending status to other countries, as stated in the Bank of Ghana's May 2025 Monetary Policy Report.
This represented a shift away from years of continuous deficits and external weaknesses. A combined surplus of $2.2 billion in the current and capital accounts, along with a net purchase of financial assets amounting to $2.1 billion, not only showed increasing investor trust and trade vitality but also positioned Ghana as a rising economic power in the region.
Yet beneath the macroeconomic optimism lies a more profound narrative, one that affects every aspect of the national environment: from government initiatives and structural changes to the executive suites of Corporate Ghana, the hallways of the public service, and the dining rooms of everyday families. This article examines how Ghana's improved external balances are more than just statistics, they represent a sign of revitalization, endurance, and preparedness.
- Government Efforts: Policy Reliability and Financial Flexibility
The net lending position enhances the Government of Ghana's standing in both domestic and global contexts. Initially, it strengthens Ghana’s credit rating, which leads to lower sovereign risk premiums and decreases the cost of borrowing in international financial markets. Given that the most recent Eurobond was issued in 2021 with a high interest rate of 8.875%, this enhanced external performance paves the way for more cost-effective financing in the future.
Within the country, the surplus offers more financial flexibility. The government's Medium-Term Revenue Strategy (2024–2027), which depends on increasing non-tax revenues and reducing inefficient spending, now has a safety net to protect investments in the social sector. Initiatives such as Agenda 111 (health infrastructure) and the YouStart program (youth entrepreneurship) may now be sped up as macroeconomic reserves grow.
Additionally, following the International Monetary Fund (IMF) approving Ghana's second review under the $3 billion Extended Credit Facility (ECF) in April 2025, the BoG's external sector report presents a strong argument for ongoing assistance and potential adjustments to the disbursement schedule.
- Ghana's Renewal Plan: Building the Basis for Deep Economic Change
The "Ghana Reset Agenda," introduced in 2023 to address the economic challenges caused by the pandemic and subsequent IMF reforms, seeks to fundamentally shift the economy toward export-driven growth, digital advancement, and industrial development. A $2.2 billion surplus in the current and capital accounts, driven by increased exports of cocoa, gold, and crude oil, along with inflows from remittances, indicates that the initiative is starting to show results.
Significant contributors include:
- Gold Exports:
Ghana continued to hold its rank as the leading gold producer in Africa, with exports reaching $2.9 billion in the first quarter of 2025 (Minerals Commission Report, April 2025).
- Non-Traditional Exports:
Including shea butter, horticultural items, and processed foods, these increased by 18% compared to the previous year, indicating progress under the National Export Development Strategy.
- Remittance Inflows:
A 12% rise in funds sent by the diaspora (from $1.06 billion in Q1 2024 to $1.19 billion in Q1 2025) reflects renewed international trust and a strong diaspora financial sector.
This enhanced external image provides the Reset Agenda with the financial credibility and story-driven momentum required to move from handling crises to promoting growth and transformation.
- Growth in the Public Sector: Efficiency, Funding, and Digital Development
The government sector, historically weighed down by salary expenses and inefficiencies, has the potential to gain significantly from enhanced performance in the external sector. As risks related to external funding decrease, the Public Investment Programme (PIP) can be broadened to encompass infrastructure upgrades, digital transformation, and strengthening the capabilities of the public sector.
This may speed up the execution of:
- gov Platform Improvements – aiding in electronic revenue collection, which increased by GH₵1.4 billion in Q1 2025 (GRA Quarterly Report).
- Digital Public Service Provision – allowing Ministries, Departments, and Agencies (MDAs) to implement cloud technology and biometric solutions with improved financial backing.
- Transport and Utility Modernization – due to enhanced access to preferential loans and bilateral agreements, such as the Ghana-Germany Green Transition Agreement concluded in March 2025.
Macro stability also enables the government to tackle unpaid wages, implement evaluations based on performance, and streamline staffing to enhance service provision in education, healthcare, and local administration.
- Corporate Ghana and Small and Medium Enterprises: A Breathing Room for Expansion
For Corporate Ghana, especially Small and Medium Enterprises (SMEs), the effects of this external sector growth are dual: consistency and cost-effectiveness.
- Exchange Rate Stability:
The cedi increased by 3.4% compared to the dollar from January to April 2025, helping to stabilize input expenses for companies that rely on imports.
- Lower Interest Rates:
As inflation decreases (from 23.5% in January 2025 to 18.7% in May 2025) and external balances improve, the Bank of Ghana has the flexibility to reduce the Monetary Policy Rate, which is now at 27.5%, possibly leading to lower commercial loan rates.
- Access to Capital:
The net acquisition of financial assets indicates increased capital inflows into the private sector. So far, banks like CalBank and Fidelity Bank have already introduced new export credit lines and SME financing programs in April 2025.
This enhanced environment allows businesses to allocate resources towards technology, employee development, and manufacturing capabilities, particularly in key areas such as agribusiness, fintech, and light industry.
- Households in Ghana: Aid, Security, and Revitalized Trust
For the typical Ghanaian family, economic progress might seem far removed, but its impact is tangible and can be quantified:
- Lower Inflationary Pressures: As food price inflation declines (from 28.3% in December 2024 to 17.6% in May 2025), families are able to make spending decisions with greater confidence.
- Job Availability: Industrial consistency and increased government funding lead to employment opportunities in construction, transportation, and service sectors. The YouStart initiative and the Ghana Enterprises Agency (GEA) have recently stated that more than 15,000 new micro, small, and medium-sized enterprise positions were established in the first quarter of 2025.
- Cedi Value: A stronger cedi helps lower imported inflation, enhancing buying capacity. For example, the cost of imported rice dropped from GH₵680 per 50kg bag in January 2025 to GH₵590 in May 2025.
In addition, individuals receiving remittances, who make up almost 20% of Ghanaian families, now benefit from improved transfer rates and greater assistance with education, healthcare, and housing.
Final Thoughts: From Excess to Environmental Responsibility
Ghana's net lending position globally in the first quarter of 2025 is more than just a numerical detail; it serves as an indicator of economic strength and revival. However, the challenge lies in maintaining these achievements through financial responsibility, export competitiveness, and equitable growth.
The chance is evident and translates macro-level success into tangible sectoral change, driving governmental reform, enabling businesses, reinforcing public services, and enhancing household welfare.
With Ghana redefining its path through the Reset Agenda, this advancement in the external sector should act as a base for economic respect, national self-belief, and long-term growth. The moment is right, not only to acknowledge a surplus, but to use it as a stepping stone with intention.