The government is not rushing to re-enter external markets despite a recent credit rating upgrade, as its current priority is stabilising the local economy, according to Dr. Sharif Mahmud Khalid, Economic Policy Advisor to the Vice President.
Speaking on Joy News’ PM Express, Dr. Khalid defended the administration’s fiscal discipline following Fitch’s decision to upgrade Ghana’s Long-Term Foreign-Currency Issuer Default Rating from ‘Restricted Default’ to ‘B-’ with a Stable Outlook.
“This rating is not just for us to celebrate and go back to borrowing,” he said. “We are not getting bullish. We are focused. We want to stabilise the domestic market first.”
He explained that while credit ratings like Fitch’s are primarily geared toward external markets, Ghana is not yet ready to return to those platforms.
“This is for the external market, which we are not ready as of yet to even start pushing through,” he insisted. “We believe in stabilising the domestic market, which is why we have internal controls.”
According to Dr. Khalid, the improved rating is not a coincidence but the result of deliberate policy decisions made since the current administration took office.
“If you look at these ratings when we took office, remember that we started to make some gains thanks to the domestic debt exchange programme,” he noted.
“That programme gave us some breathing space, and obviously that would impact any external ratings.”
He also highlighted structural reforms and cost containment measures as part of the government’s fiscal strategy.
“In terms of spending—or what you call overspending—we’ve been tightening controls. We’ve reduced appointments, and that in itself is a signal,” he said.
Dr. Khalid rejected claims that the government had already overspent, arguing that financial markets respond the moment the budget is announced, not when expenditures are made.
“Once the budget is read, the market responds whether you spend a penny or not—because the market knows what you’re going to spend. You’ve done the allocations and appropriations,” he explained.
He further referenced efforts to rebuild credibility with both local and international partners.
“We reactivated the Sinking Fund. That’s an insurance measure for servicing debt,” he said. “If you commit to both external and domestic debt programs, you naturally improve. And that’s what Fitch is recognising.”
Dr. Khalid said the B- rating signals a clear improvement: “It means you’ve improved in terms of your risk of defaulting on a debt payment.”
He credited not just the Fitch rating but the broader macroeconomic trajectory, arguing that there is now evidence of an economy on the mend.
“You were talking earlier about the economy looking better. The downgrading is now being reversed. Indicators are being upgraded.”
Despite the positive outlook, Dr. Khalid emphasised that the government would not become complacent.
“We’re not here celebrating. We are building. And we’ll continue to keep our eyes on stabilising the Ghanaian economy,” he concluded.
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