Modern Times

By Michael Awala
Date: 27/05/2025

Former President John Dramani Mahama has projected that Ghana’s debt-to-GDP ratio could hit 55% by the end of 2025 a significant improvement from current levels if prudent economic policies are implemented under the next National Democratic Congress (NDC) government.

The announcement, made during a recent media interaction, underscores Mahama’s broader plan to restore fiscal discipline, promote investment, and ease the economic burden on ordinary Ghanaians. “We’re likely to achieve our debt to GDP ratio of 55% by end of 2025,” he said confidently, pointing to a roadmap aimed at responsible borrowing, better revenue management, and stronger accountability.

Understanding the Debt-to-GDP Ratio

The debt-to-GDP ratio is a critical indicator of a nation’s fiscal health. It compares a country’s public debt to its gross domestic product (GDP), serving as a measure of how well a nation can pay off its debts. A lower ratio generally indicates a healthier economy with more fiscal space for development.

In recent years, Ghana’s ratio has exceeded 70%, leading to concerns from international bodies such as the IMF and World Bank. A decline to 55% would mark a notable turnaround restoring investor confidence and improving the country’s credit rating.

Mahama’s Strategy for Recovery

Mahama’s proposal includes:

Enhanced Domestic Revenue Mobilization: Through tax reform and plugging leakages in revenue collection.

Fiscal Discipline and Anti-Corruption Measures: A tighter rein on government expenditure and eliminating waste in public finance.

Productive Investments: Channeling borrowed funds into infrastructure, agriculture, and industry to spur growth.

Inclusive Economic Growth: Supporting small businesses and reducing youth unemployment.


A Political and Economic Statement

Beyond the figures, Mahama’s projection is a direct response to current economic hardships and what he describes as “reckless borrowing and mismanagement” under the current administration. By offering a clear benchmark 55% debt-to-GDP by 2025 he is setting the stage for a policy-driven campaign as Ghana heads toward the 2024 elections.

What It Means for Ghanaians

If achieved, this reduction could stabilize inflation, ease interest rates, and attract more foreign investment. It could also translate into less pressure on the cedi and improved economic conditions for everyday citizens.

However, skeptics argue that such a target will require not only competent leadership but also cooperation from global financial institutions and robust structural reforms.

Conclusion

Mahama’s pledge to bring Ghana’s debt-to-GDP ratio down to 55% by the end of 2025 presents a hopeful vision for the country’s economic future. While challenges remain, the goal is both ambitious and necessary for sustainable development.

As the political season intensifies, Ghanaians will be watching closely not just for promises, but for credible plans and the will to execute them.