The International Monetary Fund (IMF) has cautioned the Government of Ghana against making an early return to the international capital markets, warning that a repeat of the “excessive and expensive borrowing” of the past could derail the country’s fragile economic recovery.

With less than two weeks to the presentation of the 2026 national budget, the IMF’s Resident Representative to Ghana, Dr. Adrian Alter, urged the government to remain prudent in its financing strategy and prioritise concessional loans from multilateral development partners such as the World Bank, the African Development Bank (AfDB), and the IMF itself.

Speaking on Channel One TV’s Point of View with Bernard Avle, Dr. Alter noted that although global financial conditions have improved slightly, Ghana’s return to the international bond market would still come at a prohibitive cost, likely exceeding 10 percent interest given the country’s current credit rating.

“We have advised the government to be extremely prudent—not to go back to the same mistakes with excessive borrowing in the past. When you have available concessional financing from multilateral agencies like the World Bank, the African Development Bank, and the IMF itself, you shouldn’t go to international markets where interest rates are currently extremely pricey,” he said.

Dr. Alter explained that borrowing costs remain steep for most emerging economies, making any near-term Eurobond issuance highly risky. Under the IMF-supported programme, Ghana is bound by strict limits on new external borrowing to ensure debt sustainability.

He said the country is expected to maintain a financing structure of about 70 percent domestic and 30 percent external borrowing, in line with the IMF’s debt sustainability framework and Ghana’s agreements with official creditors.

“On the domestic market, we’ve worked closely with the government to start lengthening the maturity of its bonds beyond one year. We hope that at the start of next year, conditions will be in place for the domestic bond market to reopen,” Dr. Alter added.

Ghana has been locked out of the international capital markets since its debt default in 2022, when the government suspended payments on most external obligations as part of efforts to stabilise the economy. The default eroded investor confidence and effectively cut off access to new international borrowing.

The country is currently implementing a $3 billion IMF-supported programme aimed at restoring macroeconomic stability after years of widening fiscal deficits, rising debt, and soaring inflation forced a comprehensive debt restructuring in 2023.

The programme seeks to restore debt sustainability, rebuild foreign reserves, and lay the foundation for inclusive and sustainable growth.

The IMF’s latest warning underscores the importance of maintaining fiscal discipline and avoiding costly external borrowing as Ghana works to consolidate its economic recovery.