World Bank Upgrades Ghana’s 2025 Growth Forecast to 4.3%, Cites Strong Services Sector and Cedi Gains

The World Bank has revised Ghana’s 2025 economic growth projection upward to 4.3%, an improvement from its earlier forecast of 3.9%, according to the latest Africa’s Pulse Report released in Washington, D.C.

The updated outlook places Ghana’s expected growth slightly below the 4.4% target set by the government in the 2025 national budget. The Bank attributed the positive revision to Ghana’s robust second-quarter performance, where the economy expanded by 6.3%, led by the services sector, which grew by 9.9% and remained the largest contributor to GDP.

Looking ahead, the World Bank anticipates steady growth, projecting Ghana’s economy to expand by 4.6% in 2026 and 4.8% in 2027.

Regional Economic Outlook

Across Sub-Saharan Africa, the World Bank forecasts economic growth to reach 3.8% in 2025, up from 3.5% in 2024. This modest rebound is supported by easing inflation pressures and renewed investment activity, despite global financial uncertainty.

The report highlighted significant progress in controlling inflation across the continent, noting that the number of African countries with double-digit inflation fell from 23 in 2022 to 10 by mid-2025. However, it cautioned that challenges such as shrinking foreign investment, reduced development aid, and global trade policy risks could still undermine recovery.

Inflation and Monetary Stability

The World Bank projects Ghana’s inflation to close 2025 at 15.4%, contrasting with the country’s current single-digit rate of 9.4% in September 2025, down sharply from 21.5% a year earlier.

While analysts consider the Bank’s inflation outlook conservative, it nonetheless signals optimism, with further declines expected to 9.4% in 2026. The Bank of Ghana has also reaffirmed its expectation that inflation will remain in single digits by the end of 2025.

Cedi Strengthens Amid Fiscal Discipline

Ghana’s currency has appreciated by over 20% in the first eight months of 2025, recovering from a 19% loss in 2024. The World Bank attributed this rebound to tight fiscal policies, improved investor confidence, and higher export earnings from cocoa and gold.

However, the Bank expressed concern over a temporary 14% depreciation of the cedi between June and early September due to limited foreign exchange supply and increased import demand ahead of the festive season.

The report also confirmed that Ghana has successfully exited the “debt distress” category after completing major restructuring agreements. Despite this, the Bank warned of refinancing pressures, citing upcoming Eurobond maturities of US$500 million in 2025 and 1.2% of GDP in 2026.

Improving Business Climate

Business conditions have shown steady improvement, with Ghana’s Purchasing Managers’ Index (PMI) rising from 50.2 in July to 50.8 in August 2025, reflecting increased orders and job creation. Inflation has continued its downward trend, falling for seven straight months to 12.1% in July, compared to 23.8% in December 2024.

The World Bank also underscored the importance of a reliable power supply for sustaining growth. It recalled that frequent power outages during the 2012–2016 “Dumsor” crisis led to a 12.3% decline in foreign direct investment outside the energy sector and reduced productivity among firms reliant on consistent electricity.

According to the report, maintaining energy stability and competitive pricing will be essential for Ghana to strengthen its industrial base and attract long-term investment.