• Login
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
  • Home
  • News
    • General
    • Political
  • Economy
  • Business
    • Agribusiness
    • Aviation
    • Banking & Finance
    • Energy
    • Insurance
    • Manufacturing
    • Markets
    • Maritime
    • Real Estate
    • Tourism
    • Transport
  • Technology
    • Telecom
    • Cyber-security
    • Cryptocurrency
    • Tech-guide
    • Social Media
  • Features
    • Interviews
    • Opinions
  • Reports
    • Banking/Finance
    • Insurance
    • Budgets
    • GDP
    • Inflation
    • Central Bank
    • Sec/Gse
  • Lifestyle
    • Sports
    • Entertainment
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video
No Result
View All Result
No Result
View All Result
NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
No Result
View All Result
Home Business

The Capital Market: Supporting Ghana’s Economic Reset

1 week ago
in Business, Features, highlights, Home, home-news, latest News
3 min read
0 0
0
92
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

The Capital Market: Supporting Ghana’s Economic Reset

The 2025 Mid-Year Budget Review, presented by Finance Minister Dr. Cassiel Ato Forson on July 24, 2025, outlines a strategic plan to reset Ghana’s economy through fiscal discipline and sustainable growth. The capital market is integral to this agenda, serving as a mechanism to mobilize resources, reduce borrowing costs, and promote economic stability. This article examines the capital market’s role in supporting Ghana’s economic reset, details key initiatives from the budget review, and provides recommendations to enhance its effectiveness, with a focus on sustainable investments for Ghanaians.

The Capital Market’s Role in Ghana’s Economic Reset

The capital market facilitates long-term financing by connecting investors with businesses and government entities through bonds and equities. In Ghana, it supports economic growth by funding small and medium enterprises (SMEs), enabling infrastructure projects, and providing investment opportunities for investors. The 2025 Mid-Year Budget Review highlights a recovering economy, with 5.3% GDP growth in Q1 2025, a 42.6% Cedi appreciation against the US Dollar, and a credit rating upgrade to ‘B-’. The capital market is positioned to advance this progress by reducing reliance on external borrowing and fostering investor confidence, aligning with the budget’s theme, “Resetting the Economy for the Ghana We Want.”

Government Initiatives to Strengthen the Capital Market

The budget review outlines measures to bolster the capital market, supporting the government’s economic reset:

  • Reopening the Domestic Bond Market: From August 2025, the government will finance the budget deficit through the domestic bond market, limiting treasury bills to cash management. Appointing bookrunners to ensure competitive pricing and broader distribution aims to lower borrowing costs. Declining treasury bill rates have saved GH¢4.9 billion in interest payments by June 2025.
  • Debt Management Strategy: A liability management program includes bond buybacks and longer-term securities issuance to stabilize the yield curve and reduce debt servicing costs, enhancing market liquidity and investor trust.
  • Financial Sector Support: Issuing GH¢1.5 billion in marketable bonds to recapitalize the National Investment Bank (NIB) has improved its Capital Adequacy Ratio to 23%, strengthening the financial sector’s capacity to support capital market activities.
  • Sinking Fund Activation: Cedi and US Dollar Sinking Fund Accounts have been established to meet debt obligations due between 2026 and 2028, ensuring predictable debt servicing and reinforcing investor confidence.
  • Debt Restructuring Progress: Timely payments to bondholders (US$700 million to Eurobond holders and GH¢9.8 billion to domestic bondholders) and advancements in external debt restructuring under the IMF program have reduced public debt by GH¢113.7 billion, lowering the debt-to-GDP ratio to 43.8%, enhancing Ghana’s creditworthiness.

These initiatives demonstrate the government’s commitment to leveraging the capital market to achieve fiscal sustainability and economic resilience.

RelatedPosts

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe

Cyber Security Authority Flags Rising Mobile Data Scam, Cautions Public

Gov’t Reopens Talks With PayPal to Restore Full Service Access in Ghana

Economic Impacts of Government Initiatives

The capital market strategies yield measurable outcomes:

  • Lower Borrowing Costs: Competitive bond issuances and reduced treasury bill rates (e.g., 91-day rate from 27.73% to 14.73%) free up resources for investments in health, education, and infrastructure.
  • Increased Investor Confidence: Debt restructuring, timely payments, and a stable Cedi, coupled with a credit rating upgrade, attract capital to the market.
  • Financial Sector Stability: NIB’s recapitalization strengthens has strengthened the banks balance sheet to facilitate investments, supporting market liquidity.
  • Support for Growth Initiatives: Capital market financing enables programs like the 24-Hour Economy and Big Push infrastructure projects, driving job creation and economic expansion.

Recommendations to Enhance the Capital Market

To maximize the capital market’s contribution to Ghana’s economic reset, the following measures are proposed:

  1. Increase Financial Literacy: The Securities and Exchange Commission (SEC) and Ghana Stock Exchange (GSE) should expand financial education programs to boost retail investor participation, promoting inclusive growth.
  2. Encourage Corporate Bond Issuance: Tax incentives and simplified regulations can spur private sector bond issuances, diversifying the market and supporting SME growth.
  3. Upgrade Market Infrastructure: Modernizing the GSE’s trading and settlement systems will enhance efficiency and transparency, aligning with global standards to attract institutional investors.
  4. Promote Green Bonds: Issuing green bonds to finance solar energy projects can enable Ghanaians to invest in affordable solar power solutions for households and businesses, reducing reliance on the Electricity Company of Ghana (ECG). This can lower energy costs, improve energy access, and align with global ESG investment trends, enhancing Ghana’s appeal to international investors.
  5. Foster Regional Integration: Collaborating with ECOWAS to develop a regional bond market can increase liquidity and position Ghana as a financial hub in West Africa.
  6. Strengthen Regulation: Enhancing the SEC’s oversight will ensure investor protection and market integrity, supporting sustained growth.

Performance of the Ghana Stock Exchange

In the second quarter of 2025, the Ghana Stock Exchange showed strong market activity, with SIC leading the performance chart at a remarkable 322% gain, followed by ACCESS (162%), ETI (174%), and CLYD (167%). Overall market indicators also reflected sustained growth, as shown by the steady rise in both the GSE Composite Index (GSE-CI) and the GSE Financial Stock Index (GSE-FSI). From January to June 2025, GSE-FSI outperformed GSE-CI, reaching a peak of 41.80% in June compared to GSE-CI’s 27.82%. The data highlights increased investor confidence and notable gains in both general and financial stocks during the period. To sustain this positive trend, the government should prioritize continued fiscal discipline to maintain a stable macroeconomic environment, enhance investor confidence through timely debt restructuring payments, and support the GSE by providing tax incentives for new listings and improving market infrastructure, such as upgrading trading systems to attract both domestic and foreign investors.

Conclusion

The 2025 Mid-Year Budget Review positions the capital market as a key driver of Ghana’s economic reset, supporting fiscal discipline and sustainable growth. By reopening the bond market, optimizing debt management, and strengthening financial institutions, the government is creating a robust platform for economic progress. Green bonds for solar energy investments offer Ghanaians a path to energy independence, reducing reliance on ECG while aligning with global sustainability trends. Implementing the recommended measures will further enhance the capital market’s effectiveness, ensuring it supports the economic transformation envisioned for Ghana.

About the Writer

Kofi Busia Kyei is a seasoned finance professional with over a decade of experience in investment management, wealth management, and stockbroking. With proven expertise in pension fund oversight, portfolio optimization, and strategic leadership, he excels in leveraging advanced technologies, including Artificial Intelligence, to deliver innovative financial solutions. Visit younginvestorcalculator.com to access his investment tools. He is currently into Pensions Funds Management at Merban Capital LTD.

 

Tags: The Capital Market: Supporting Ghana’s Economic Reset

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

No Result
View All Result

Highlights

Financial Sector Assets up 34.6% in 2024 to GHS 525.59 Billion

Banking Sector Soundness Remains Robust in 2024 Amid Strong Profitability, Adequate Capital Buffers

Sha’Carri Richardson Withdraws from US Trials Following Arrest

From Singuluma to El Kaabi: Can CHAN 2024 Unleash the Next Hat-trick Hero?

Ghana to Welcome King’s Baton Relay on August 8 Ahead of 2026 Commonwealth Games

RMA Demands Public Inquiry into Unibank Collapse, Slams AG’s Decision to Drop Charges

Trending

Features

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe

August 2, 2025

GACL Terminates Evatex Revenue Assurance Contract Amid OSP Probe The Ghana Airports Company Limited (GACL) has officially...

Cyber Security Authority Flags Rising Mobile Data Scam, Cautions Public

August 2, 2025

Gov’t Reopens Talks With PayPal to Restore Full Service Access in Ghana

August 2, 2025
Bank of Ghana

Financial Sector Assets up 34.6% in 2024 to GHS 525.59 Billion

August 2, 2025

Banking Sector Soundness Remains Robust in 2024 Amid Strong Profitability, Adequate Capital Buffers

August 2, 2025

Who we are?

NORVANREPORTS.COM |  Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World

NorvanReports is a unique data, business, and financial portal aimed at providing accurate, impartial reporting of business news on Ghana, Africa, and around the world from a truly independent reporting and analysis point of view.

© 2020 Norvanreports – credible news platform.
L: Hse #4 3rd Okle Link, Baatsonaa – Accra-Ghana T:+233-(0)26 451 1013 E: news@norvanreports.com info@norvanreports.com
All rights reserved we display professionalism at all stages of publications

No Result
View All Result
  • Home
  • Business
    • Agribusiness
    • Aviation
    • Energy
    • Insurance
    • Manufacturing
    • Real Estate
    • Maritime
    • Tourism
    • Transport
    • Banking & Finance
    • Trade
    • Markets
  • Economy
  • Reports
  • Technology
    • Cryptocurrency
    • Cyber-security
    • Social Media
    • Tech-guide
    • Telecom
  • Features
    • Interviews
    • Opinions
  • Lifestyle
    • Entertainment
    • Sports
    • Travel
    • Environment
    • Weather
  • NRTV
    • Audio
    • Video

Welcome Back!

Login to your account below

Forgotten Password?

Create New Account!

Fill the forms bellow to register

All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
NORVANREPORTS.COM | Business News, Insurance, Taxation, Oil & Gas, Maritime News, Ghana, Africa, World
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it.