Deloitte Ghana is cautioning the government against its plan to return to the capital markets, although borne out of the improved macroeconomic environment and the resultant upgrades by the international credit rating agencies.

According to the professional services firm, the government must take recycling lessons from historical mistakes to avoid a repeat of the debt hangover experienced over the last three years.

“Reliance on foreign debts must be moderated, with inflows strictly channeled into strategic capital investments that can adequately support repayment of such loans”, it said in its assessment of the 2025 Mid-Year Review Budget.

As of the end of June 2025, Ghana’s total public debt had reduced by GH¢113.7 billion, representing a 15.6% reduction from GH¢726.7 billion at the end of December 2024 to GH¢613 billion in June 2025. This was mainly on the account of the appreciation of the Ghana cedi.

During the same period, the gross public debt as a percentage of Gross Domestic Product (GDP) stood at 70.6% in June 2024 as compared to 43.8% as of June 2025. This was primarily due to the government’s finalisation of its debt restructuring programme and the positive impact of the appreciation of the Ghana cedi on external debt stock, indicating a significant improvement in debt levels.

Deloitte said the significant decline in the debt-to-GDP ratio (from 78.5% as of December 2021 to 43.8% as of June 2025), reflects an improvement in debt sustainability and major progress towards the medium-term target debt-to-GDP ratio of 55% by 2028, as agreed with the International Monetary Fund.

It added the the improvement in debt sustainability is expected to induce improved ratings from other international credit rating agencies such as S&P and Moody's, which, in turn, will drive up investor confidence in Ghana’s economy.

The government's plan to establish cash buffers in a sinking fund for repayment of loan points to a commitment to honour debt obligations as they fall due.

“We recommend that the government accelerate efforts in this regard and provide regular updates on the fund’s position in order to enhance investor confidence”, it advised.