Ghana’s 2027 Budget: Three important policy questions about the New Economy

On November 12, 2026, Ghana's Minister for Finance is set to unveil the 2027 Budget, marketed as an entry point into the government's New Economy initiative. The centerpiece of this strategy is a US$10 billion investment program spread over four years, aimed at boosting infrastructure, agriculture, manufacturing and other key sectors.

The transition from focusing solely on macroeconomic stabilization to investment-driven growth is seen as a positive policy move. Ghana has made substantial strides in restoring fiscal stability, and the New Economy presents an opportunity to leverage these gains by tackling structural impediments to economic expansion, ramping up productive output, fostering sustainable job creation, and elevating household incomes.

Nonetheless, the proposed New Economy policy framework raises three crucial economic policy questions. First, what portion of the announced investment is truly new and additional? Second, how will the government cover the expanded fiscal deficit resulting from this budgetary shift? And third, how will the investment program align with the government's ambitious target of accumulating foreign reserves?

The first question involves gauging the extent to which the proposed investment program surpasses the government's existing expenditure plans. The proposed 4.6% of GDP allocated to capital expenditure for 2027 may seem modest given the infrastructure challenges and the pressing need for productive investments. However, it is vital to discern whether the New Economy will augment this allocation or merely finance projects that were already part of the government's spending plans.

If the entire fiscal space of 1.5% of GDP is directed towards capital expenditure, the public investment-to-GDP ratio could potentially rise from the current 4.6% to 6.1%. The critical point here is whether the forthcoming budget will deliver such a significant increase or if the New Economy will essentially replicate projects already included in the Big Push Infrastructure Programme, the 24-Hour Economy initiative and other ongoing commitments.

The second question pertains to the means by which the government will manage the enlarged fiscal deficit. A decrease in the primary surplus from 1.5% to 0.5% of GDP would, all else being equal, escalate the overall cash deficit from around 2.5% to 3.5% of GDP. This fiscal expansion poses a significant financing challenge, especially considering Ghana's substantial debt repayment obligations and the government's pledge not to return to the international Eurobond market.

The manner in which the government plans to finance this larger deficit will significantly impact the feasibility and sustainability of the New Economy's investment agenda.