Deloitte Urges Ringfencing of Borrowed Funds as Government Prepares Return to Bonds Market
Deloitte has called on the Government to ensure strict ringfencing of all borrowed funds as it prepares to re-enter the bonds market, stressing that proceeds should be directed exclusively toward self-paying projects. According to the firm, such an approach is critical to easing pressure on domestic revenue, which continues to bear the weight of interest and principal repayment obligations. Deloitte maintains that committing external resources to commercially viable projects will reinforce fiscal discipline and support a more sustainable fiscal framework.
The advisory comes alongside the firm’s broader assessment of Ghana’s debt position, following the recent upgrade of the country’s debt distress rating from high to moderate. Deloitte described the development as encouraging but warned that the fiscal outlook remains fragile. It urged Government to adopt stronger safeguards to enhance its debt profile and rebuild investor confidence, particularly among external commercial creditors.
In the report, Deloitte emphasised the importance of a concessional-first borrowing strategy, arguing that prioritising low-cost financing will help reduce debt servicing costs and minimise exposure to refinancing risks. The firm recommended that concessional resources be channelled into large-scale infrastructure, social and climate-related programmes to maximise long-term economic returns.
Deloitte also described Government’s planned re-entry into the domestic bonds market as a prudent and necessary step to restore engagement with local investors. However, it stressed that this move should be executed cautiously and used mainly as a liability management strategy to extend debt maturities, rather than as a tool to support new expansionary spending.
On the Government’s intention to pursue debt reprofiling and a buyback programme, Deloitte said such measures represent a strategic response to the challenges posed by high-cost debt and uneven repayment schedules. It advised that buybacks should focus on the most expensive and volatile instruments to minimise risks to fiscal stability.
The firm further underscored the need for continuous dialogue with domestic and international stakeholders to maintain market confidence. It also urged transparent communication on the objectives, processes and expected outcomes of all debt operations to prevent unnecessary market disruptions.
Deloitte concluded that debt reprofiling, buybacks and future borrowing decisions must be anchored in a coherent strategy centred on prudent fiscal management and sustainable debt practices
