The Centre for Democratic Development Ghana (CDD-Ghana) has cautioned that Ghana’s recent economic recovery under the John Dramani Mahama administration, though impressive on the surface, rests on what it describes as a “fragile foundation".

In its one-year assessment released Thursday, February 19, the civil society group acknowledged that many Ghanaians are beginning to feel relief in the cost of living but warned that underlying fiscal and structural risks could threaten the gains.

In its strongest caution, CDD-Ghana said the apparent macroeconomic stability may not yet be durable.

“However, this stability is built on a fragile foundation,” the report stressed.

It explained that much of the cedi’s recent strength stemmed from gold reserve sales rather than deep structural transformation in manufacturing and exports.

The group also flagged labour market weaknesses, noting that most new jobs remain in the informal sector while about one-third of young Ghanaians are unemployed or out of school.

However, the report highlighted that falling inflation, the appreciation of the cedi and declining fuel prices have produced measurable price reductions in key sectors.

“For the first time in several years, many Ghanaians attest to experiencing a tangible fall in the cost of living,” the assessment noted.

Fuel prices dropped between four and eight per cent around December 2025–January 2026, triggering a 15 per cent reduction in commercial transport fares. Food inflation also plunged sharply from 28.3 per cent in January 2025 to 4.9 per cent by December 2025.

However, CDD-Ghana stressed that the benefits are uneven across the country, with some northern regions yet to experience the same price relief due to logistics bottlenecks and transport challenges.

The think tank credited the administration with achieving a significant fiscal reset in 2025.

Key gains highlighted include:

• Debt-to-GDP ratio falling from 61.8% to 45%
• Treasury bill rates dropping from 30% to 11%
• Budget deficit narrowing from 7.9% to 3.1%
• Successful external debt restructuring boosting investor confidence

Credit rating agencies Fitch Ratings and Moody's subsequently upgraded Ghana to B- status, signalling improved global confidence.

CDD also pointed to strict commitment-based spending in 2025, which prevented the accumulation of new arrears.

Despite the progress, the group identified domestic revenue mobilisation as a major vulnerability.

Tax revenue currently stands at 16.1% of GDP, still below peers such as Senegal and Côte d'Ivoire, creating what the report calls a persistent “revenue lag".

This shortfall, CDD warned, forces the government to rely on borrowing to finance spending, raising concerns about future debt accumulation.

The think tank specifically flagged the fiscal risks posed by large-scale programmes such as the GH₵13.85 billion Big Push infrastructure agenda and the MahamaCares health initiative.

“The general worry is that if the government doesn’t find a way to generate more revenues soon, these high-cost programs could eventually break the budget and undo the financial stability,” the report warned.

CDD-Ghana described the creation of the Ghana Gold Board (GoldBod) in March 2025 as a landmark intervention that boosted exports, with small-scale miners shipping 103 tonnes valued at US$10.8 billion — surpassing large-scale mining output.

Yet the report raised environmental and governance concerns, warning the initiative could be unintentionally encouraging illegal mining.

Looking ahead, CDD warned that the government faces significant repayment pressures, about GH₵20 billion in 2026 and GH₵50.3 billion in 2027.

It said the administration must maintain strict fiscal discipline and accelerate growth to avoid slipping back into a debt trap.

“The test of the ‘Reset Agenda’ will not be in rhetoric but in concrete institutional reforms,” the report concluded.

CDD-Ghana urged the government to move beyond short-term stabilisation and focus on value addition, job creation, and environmental protection to secure long-term economic resilience.