Total appropriation for the 2025 fiscal year has increased by 16% to GHS 290 billion, up from GHS 250 billion in 2024.
This was captured in the maiden budget by the new John Mahama government presented in parliament on Tuesday March 11, 2025 by Finance Minister, Dr. Cassiel Ato Forson.
Although the government is pushing a fiscal consolidation agenda aimed at narrowing deficits, tightening public spending and stabilising the economy, it is ramping up expenditure to support priority infrastructure projects, social interventions and debt servicing obligations.
“Mr. Speaker, based on the resource allocations for the 2025 fiscal year, the total appropriation for the year ending 31st December 2025 is GHS 290,971,212,435,” Dr. Forson announced.
While total expenditure is projected at GHS 269.1 billion (20.7% of GDP), down from GHS 279.2 billion (26.0% of GDP) in 2024, the government anticipates revenue and grants of GHS 223.8 billion, equivalent to 17.2% of GDP.
This represents a notable increase from GHS 186.5 billion (17.4% of GDP) in 2024, largely driven by non-oil revenue measures expected to contribute at least 0.5% of GDP.
Primary expenditure—excluding interest payments—is estimated at GHS 204.7 billion (15.8% of GDP), a sharp decline from GHS 232.4 billion (21.7% of GDP) in 2024.
This suggests an effort to rein in spending while maintaining essential government functions.
Ghana is still under a challenging economic landscape characterised by high debt levels, currency volatility and inflationary pressures.
The 2025 budget figures signal an attempt to strike a delicate balance between expenditure rationalisation and developmental needs.
However, the Finance Minister, Dr. Cassiel Ato Forson says, government will intensify revenue generation efforts through tax policy reforms and improved compliance measures to curb fiscal deficits.
The budget deficit is expected to narrow to 3.1% of GDP in 2025, down from 3.9% in 2024.
To achieve this, the government plans to intensify revenue generation through tax policy reforms and stricter compliance measures.
Sector Ministers are now expected to provide further details on allocations for spending commitments without derailing the broader fiscal consolidation roadmap.
Ghana’s GDP is projected to grow by 4.4% in 2025, with non-oil GDP expected to expand at an even stronger rate of 5.3%, signalling a push toward economic diversification.
However, inflation remains a pressing concern.
The government has set an ambitious end-of-year inflation target of 11.9% for 2025, following a 2024 end-year rate where inflation rose to 23.8%—well above the initial 15% target.
For some market analysts, the government’s 2025 end-year inflation target is “a little aggressive,” citing Ghana’s struggle to tame inflationary pressures.
They warn that achieving this target will require significant effort but believes other macroeconomic goals are within reach.
“The inflation target of 11.9%, looks a little aggressive. We are currently just over 23% but you have to understand that we have really struggled throughout 2024 to reduce the inflation rate beneath the 22% mark. I think it will take a more aggressive policy”, Economist Prof. Patrick Assuming opined.
