Introduction
The global economic vista in 2025 presents a compelling narrative of resilience and life-changing, with Ghana emerging as an unexpected success story. The Ghanaian cedi has achieved what many considered improbable—becoming the world’s best-performing currency after appreciating nearly 50% against the US dollar within just six months. This extraordinary turnaround is not a product of chance but the culmination of deliberate policy reforms, disciplined fiscal management, and strategic international partnerships. For Nigeria, Africa’s largest economy yet struggling with persistent inflation, currency instability, and sluggish growth, Ghana’s resurgence offers more than just inspiration—it provides a tangible blueprint for sustainable economic transformation.
The historical, cultural, and economic ties between Nigeria and Ghana make this comparison particularly poignant. Both nations emerged from colonial rule with similar economic structures, yet their trajectories have diverged significantly in recent years. While Nigeria continues to grapple with chronic forex shortages, mounting debt burdens, and declining oil revenues, Ghana has demonstrated how bold reforms can stabilize an economy and restore investor confidence. This article dig deeper into the key drivers behind Ghana’s economic success, critically examines Nigeria’s structural challenges, and proposes actionable strategies that could propel Nigeria toward a similar—if not greater—economic revival.
Ghana’s economic transformation: Key success factors
- Proactive monetary policy and Central Bank interventions
The foundation of Ghana’s economic revival was laid by the Bank of Ghana (BoG) through a series of decisive monetary policy adjustments. Faced with inflationary pressures that peaked at 54% in 2023 and a rapidly depreciating currency, the BoG implemented a comprehensive strategy that addressed both immediate liquidity concerns and long-term stability.
A critical move was the 100 basis-point hike in the policy rate, raising it to 28%. This aggressive tightening of monetary policy served multiple purposes: it curbed excessive liquidity in the system, reduced speculative demand for foreign exchange, and signaled to international investors that Ghana was serious about macroeconomic stability. The impact was almost immediate, with inflation trending downward to 18% by mid-2025.
Complementing this was the BoG’s injection of $490 million into the forex market—a strategic intervention that stabilized the cedi and improved dollar liquidity. Perhaps most transformative was the shift to spot-market forex auctions, which replaced the previous opaque allocation system. This transparency reduced hoarding and rent-seeking behaviours that had previously distorted the forex market. The cumulative effect of these measures was a restoration of confidence in the cedi, attracting renewed foreign portfolio investments and setting the stage for sustained economic recovery.
- Commodity export boom and trade surplus
Ghana’s export sector has been a powerhouse of economic growth, with total exports reaching GH₵294.9 billion ($24.5 billion) in 2024—yielding a remarkable trade surplus of GH₵44.7 billion ($3.7 billion). This performance was driven by three key commodities that collectively accounted for over 78% of export earnings.
Gold emerged as the star performer, contributing 42% of total exports. The sector benefited from both high global prices and increased production following government incentives to formalize small-scale mining operations. Crude oil followed closely at 28%, with stable output from the Jubilee and TEN fields despite global market volatility. Cocoa, while smaller at 8.2% of exports, told an important story of value addition—Ghana processed more of its cocoa domestically rather than exporting raw beans, capturing more value along the supply chain.
This strategic diversification beyond a single commodity insulated Ghana’s economy from the shocks that often plague resource-dependent nations. It also created a more balanced economic structure where multiple sectors could drive growth simultaneously.
- IMF support and fiscal discipline
Ghana’s engagement with the International Monetary Fund (IMF) through a $3 billion Extended Credit Facility (ECF) program in 2024 marked a turning point in its economic recovery. The program was not merely a financial lifeline but a catalyst for comprehensive structural reforms.
The government’s debt restructuring efforts successfully reduced the debt-to-GDP ratio from a precarious 90% to a more manageable 75% through negotiated haircuts with creditors. Simultaneously, expenditure rationalization measures cut non-essential spending, particularly on poorly targeted subsidies, while improving public financial management systems to prevent leakage.
On the revenue side, Ghana expanded its tax base through digital systems that reduced evasion, particularly in the informal sector that had traditionally operated outside the tax net. These reforms collectively restored macroeconomic stability, leading to upgraded credit ratings from international agencies and renewed investor confidence—factors that were crucial in attracting both portfolio and direct investment flows.
- Strategic trade partnerships and value addition
Ghana’s economic strategy extended beyond domestic reforms to shrewd international engagement. The country capitalized on China’s decision to remove all tariffs on African exports in 2025, rapidly diversifying its trade relationships beyond traditional Western partners. This move was particularly impactful for Ghana’s manufactured goods, which gained competitive advantage in the massive Chinese market.
Domestically, Ghana moved aggressively up the value chain in its key export sectors. The cocoa industry’s transformation was emblematic of this shift—where Ghana once exported nearly all its cocoa as raw beans, it now processes over 40% domestically. This not only increased export revenues but created thousands of jobs in processing and manufacturing.
The African Continental Free Trade Area (AfCFTA) provided another strategic avenue. Ghana positioned itself as a manufacturing hub for West Africa, leveraging the agreement to increase intra-African trade in processed goods rather than raw materials. This forward-looking approach reduced Ghana’s vulnerability to global commodity price swings while fostering regional economic integration.
Nigeria’s economic challenges: Why Ghana’s model matters
While Ghana’s success provides valuable lessons, Nigeria’s economic hurdles are more complex due to its sheer size, entrenched structural inefficiencies, and persistent governance gaps. Understanding these challenges is essential to adapting Ghana’s successful strategies to Nigeria’s unique context.
- Infrastructure deficit: The power and transport bottleneck
Nigeria’s infrastructure gap represents perhaps the most significant drag on economic growth. The electricity crisis is particularly acute—with installed capacity hovering around 12,000 MW but actual generation frequently below 4,500 MW for a population exceeding 200 million. This contrasts starkly with Ghana’s more reliable 5,000+ MW system serving just 33 million people. Nigerian manufacturers routinely cite power as their primary constraint, with many forced to rely on expensive diesel generators that erode competitiveness.
Transport infrastructure presents another critical challenge. Major highways like the Lagos-Ibadan expressway remain perennially congested, while the Apapa port gridlock has become emblematic of systemic inefficiencies. The World Bank estimates that Nigerian businesses lose nearly $1 trillion annually due to poor infrastructure—a staggering figure that underscores the urgency of addressing these gaps.
- Ease of doing business: Regulatory and security hurdles
Nigeria’s ranking of 131st in the World Bank’s Ease of Doing Business Index (2020)—behind Ghana’s 118th—reflects deep-seated bureaucratic and regulatory challenges. Businesses face a labyrinth of overlapping taxes from federal, state, and local governments, creating an unpredictable fiscal environment.
The process for business registration, permits, and forex access remains cumbersome, often requiring lengthy engagements with multiple agencies. Perhaps most damaging are security concerns—from insurgency in the northeast to kidnapping nationwide and oil theft in the Niger Delta. These factors collectively deter foreign investment and drive up the cost of operations for domestic businesses.
- Corruption and weak fiscal governance
Transparency International’s 2023 Corruption Perception Index ranks Nigeria 145th globally, far below Ghana’s 70th position. This governance gap manifests in critical ways—poor budget execution where allocated funds fail to translate into tangible projects, wasteful subsidies (in agriculture and other sectors) that disproportionately benefit elites, and a debt management strategy that has seen debt servicing consume over 90% of government revenue in 2024.
The lack of transparency in public finance makes it difficult to attract long-term investment, as investors cannot reliably predict policy directions or trust that contracts will be honoured. This stands in stark contrast to Ghana’s relative success in implementing transparent reforms through its IMF program.
- Over-reliance on oil and lack of diversification
Despite possessing vast agricultural land and significant solid mineral deposits, Nigeria remains perilously dependent on oil—which accounts for 90% of export earnings and 60% of government revenue. This mono-product economy leaves Nigeria vulnerable to the boom-bust cycles of global oil markets, as evidenced by the economic contractions that follow every oil price downturn.
The agricultural sector, which could serve as an alternative growth engine, remains hampered by low productivity, inadequate processing capacity, and poor rural infrastructure. Similarly, solid minerals development has been stymied by informal operations and weak regulatory frameworks. This lack of diversification represents both a vulnerability and a missed opportunity given Nigeria’s resource endowment.
Strategic lessons for Nigeria: A path to economic revival
- Monetary policy overhaul: Stabilising the naira
Nigeria’s monetary policy requires fundamental restructuring to stabilize the naira and control inflation. The Central Bank of Nigeria (CBN) should emulate Ghana’s transparent forex policy and interest rate management. As of mid-2025, Nigeria operates under a floating exchange rate regime, where the naira’s value is primarily influenced by market forces. The CBN continues to monitor the FX market and may intervene occasionally to stabilize the currency or address extreme volatility, but such interventions are now more transparent and aligned with market conditions.
Ghana’s experience shows that transparency in forex allocation through mechanisms like spot auctions can reduce speculation and build confidence.
Increasing forex liquidity is equally critical. Nigeria should leverage its vast diaspora through innovative digital channels that make remittance flows more efficient. Simultaneously, stricter enforcement of export proceeds repatriation could bring much-needed foreign exchange into the official system rather than parallel markets.
Tightening interest rates, while potentially painful in the short term, may be necessary to curb inflation—as Ghana demonstrated with its decisive rate hikes. This should be accompanied by measures to deepen financial inclusion, ensuring that monetary policy transmission reaches all sectors of the economy.
- Export diversification and value addition
Nigeria must break its oil dependency by aggressively developing non-oil exports. Cocoa, sesame, cashew, and solid minerals represent low-hanging fruits where Nigeria already has comparative advantage but lacks the value-chain development seen in Ghana.
The creation of specialized agro-processing zones could revolutionize these sectors by reducing post-harvest losses—estimated at over $9 billion annually—and enabling Nigeria to export processed goods rather than raw materials. The AfCFTA presents a golden opportunity here; Nigeria should position itself as West Africa’s manufacturing hub, leveraging its large domestic market as a base for regional expansion.
- Fiscal Reforms and Debt Management
Strategic engagement with the IMF could provide Nigeria the framework for necessary reforms without imposing harsh austerity. Ghana’s experience shows that IMF programs can be tailored to local contexts while still enforcing fiscal discipline. The recent loan repayment of Covid-19 IMF loan is a positive omen for a better future.
Also, governance costs could be streamlined through measures like reducing the size of government and merging redundant agencies.
Revenue mobilisation must go beyond simply increasing tax rates. Expanding the tax base through digital systems, as Ghana did, could bring more businesses into the formal sector while reducing evasion. Property taxes and subnational revenue generation also offer untapped potential. The Tax reform bill under consolidation by the National Assembly hopefully will assist in this direction.
- Infrastructure and Energy Revolution
The power sector requires bold reforms, potentially including privatization of distribution companies to improve efficiency. Renewable energy investments should be accelerated, particularly solar projects that can provide decentralized solutions to Nigeria’s energy poverty. Moribund hydroelectric dams like Kainji and Shiroro should be expedited to improve power generation in the country.
According to PWC, The Electricity Act 2023 is a comprehensive and insightful document full of valuable information. Electricity Act 2023 is a good step for consolidating the laws governing the Nigerian Electricity Supply Industry and establishing a policy framework that empowers state governments and investors. The Act empowers state governments to participate in areas previously reserved for the federal government, particularly transmission and distribution. The Act defines how states can participate, with different state Houses of Assembly playing a vital role. As of today, only 12 States have passed the enabling laws, and more should be encouraged to join the rollcall before 2025 ends.
Transport networks need comprehensive modernization—from completing critical highway projects to decongesting ports through improved operations and alternative facilities like the Lekki Deep Sea Port and others in the South-south region. These infrastructure investments would dramatically reduce the cost of doing business.
- Strengthening governance and anti-corruption measures
Transparency in public finance must become non-negotiable. Implementing open contracting systems and real-time budget tracking would allow citizens to monitor how public funds are spent. Judicial reforms to expedite commercial dispute resolution would significantly improve Nigeria’s investment climate.
Perhaps most importantly, Nigeria needs sustained political will to implement these reforms consistently across electoral cycles—a challenge Ghana has managed relatively well through its economic transformation.
The road ahead: Turning potential into prosperity
Nigeria’s path to economic recovery and growth is tied to its ability to implement structural reforms, improve infrastructure, and harness its natural resources efficiently. The ongoing tax reform bill and the Electricity Act 2023 provide strong foundations for economic stability. At the same time, the removal of fuel subsidies and unification of exchange rates are bold steps toward eliminating economic distortions. However, the implications of this two-pronged necessity has spiked inflationary trends among the population with disposable income remaining stagnant or dwindling by the day. The government must continue to support the people through necessary programme to relief the economic pressure that these necessary policies has brought on the people.
However, these reforms require sustained action, faith in their potential, and patience as Nigeria moves toward economic resilience. The journey may be long, but it is achievable with continued commitment from both the public and private sectors.
Conclusion
I think Nigeria’s moment for transformative change cannot be postponed, it must be now. Ghana’s economic resurgence in 2025 demonstrates conclusively that sound policies, disciplined leadership, and strategic global integration can turn around even the most challenging economies. While Nigeria’s challenges are undeniably more complex due to its size and structural inefficiencies, the fundamental lessons from Ghana remain universally applicable.
Nigeria stands at a crossroads because it possesses all the necessary ingredients for economic transformation—abundant natural resources, a large and youthful population, and a strategic geographic position. What has been lacking is the consistent implementation of bold reforms across monetary policy, export diversification, fiscal discipline, and infrastructure development.
The time for half-measures and incremental change has passed. Nigeria must embrace comprehensive reform with the same urgency and determination that Ghana demonstrated. By learning from Ghana’s playbook while adapting solutions to Nigeria’s unique context, the nation can finally unlock its long-promised economic potential.
The question that remains is not about the availability of solutions, but about the political will to implement them. As Ghana has shown, economic transformation is possible even in challenging circumstances—but it requires leaders willing to make difficult decisions and citizens holding them accountable for results. Nigeria’s moment for transformative change is here; the only uncertainty is whether its leaders will seize it.
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Prof. Sarumi is the Chief Strategic Officer, LMS DT Consulting, Faculty, Prowess University, US, and ICLED Business School, and writes from Lagos, Nigeria. He is also a consultant in TVET and indigenous education systems, affiliated with the Global Adaptive Apprenticeship Model (GAAM) research consortium. Tel. 234 803 304 1421, Email: leadershipmgtservice@gmail.com.
