S&P Upgrades Ghana’s Credit Rating to ‘B-/B’ With Stable Outlook

Ghana has received a significant boost to its international financial reputation as S&P Global Ratings announced an upgrade of the country’s long- and short-term foreign and local currency sovereign credit ratings from ‘CCC+/C’ to ‘B-/B’, with a stable outlook.

The agency also raised Ghana’s transfer and convertibility assessment to ‘B-’ from ‘CCC+’, reflecting improving external liquidity and policy credibility. According to the ratings agency, the upgrade reflects Ghana’s improved balance of payments, fiscal reforms, and stronger performance.

“The stable outlook balances the potential for stronger balance-of-payments performance and improvements in Ghana’s fiscal outcomes as a result of ongoing expenditure reforms against still-high debt-service costs, reform implementation risks, and Ghana’s sensitivity to terms of trade, such as gold and cocoa prices, which have been unusually favorable over the last year.”

The revision marks a major turnaround for Ghana, which defaulted on its Eurobond payments in December 2022, triggering a period of economic distress and loss of investor confidence.

Since then, the country has made considerable progress in restructuring both external and domestic debt while implementing fiscal and monetary reforms under its International Monetary Fund (IMF)-supported program. S&P emphasized that Ghana’s external position has strengthened, supported by higher export earnings and a build-up of reserves.

“Rising export volumes and favorable prices for key exports gold and cocoa have in 2025 supported the exchange rate of the Ghanaian cedi and boosted Ghana’s gross foreign currency reserves to almost $11 billion (9% of 2025 forecast GDP), up from $6.8 billion at end-2024.”

The improvement in foreign reserves has provided a cushion for the Ghanaian cedi, which has seen relative stability after years of volatility driven by fiscal deficits and external shocks.

The agency also that Ghana’s inflation trajectory has improved substantially, bringing relief to consumers and businesses.

“We forecast inflation to remain below 10% in 2026, while the authorities are taking steps to strengthen Ghana’s budgetary discipline with new fiscal rules and better public financial management practices aimed at preventing fiscal slippage.”

The ratings agency credited the government’s renewed commitment to fiscal prudence and debt sustainability as key to restoring macroeconomic stability.

Ghana’s new fiscal rules, which cap deficits and enhance expenditure control, are expected to reduce the risk of unsustainable borrowing and reinforce confidence among investors and development partners. On the debt front, S&P acknowledged that Ghana has made substantial progress in addressing its liabilities.

“In October 2024, Ghana completed the exchange of $13.1 billion Eurobonds following its default in December 2022 and has recently made further progress on restructuring remaining debt, although disputes with some creditors could delay a full resolution.”

The successful completion of the Eurobond restructuring marked a critical step in Ghana’s recovery efforts, aligning with the IMF’s $3 billion Extended Credit Facility program and enabling the country to resume normal relations with creditors.

However, S&P cautioned that Ghana’s progress remains fragile and dependent on maintaining reform momentum and managing external vulnerabilities.

“Notwithstanding stronger recent economic outturns, Ghana’s economy remains exposed to risks from commodity price fluctuations and broader external and weather-related shocks.”

S&P further noted that the effectiveness of ongoing fiscal reforms has yet to be fully tested, especially as Ghana approaches another election cycle in 2028.

The stable outlook reflects S&P’s expectation that Ghana will continue to implement its fiscal reforms and debt management strategy while maintaining macroeconomic stability.

It also signals renewed investor confidence in Ghana’s recovery trajectory, though the agency emphasized that debt-servicing pressures and exposure to commodity price swings remain significant risks.

The upgrade could enhance Ghana’s access to capital markets and lower its borrowing costs if the government sustains reform commitments and strengthens transparency in public financial management.

The announcement comes at a time when Ghana’s economic indicators show encouraging signs of stabilization with inflation declining, reserves rising, and the fiscal deficit narrowing.