IMF: Ghana’s state-owned enterprise reforms have not improved financial performance
The International Monetary Fund stated that extensive reforms of state-owned enterprises in Ghana over the past decade have not yet led to an improvement in their financial performance. As MyJoyOnline reports, an IMF technical report points to persistent structural problems in the sector.
Revenue growth did not change the outcome
According to the fund’s assessment, state-owned enterprises in the energy and extractive sectors remain the main source of financial strain. Among the factors putting pressure on public finances, the IMF cited the accumulation of arrears, liquidity shortages, and tariffs that do not cover costs.
SOE revenues in nominal terms rose from 19 billion Ghanaian cedis in 2015 to 133 billion cedis in 2024. At the same time, this did not ensure an improvement in the portfolio’s overall performance. Although many companies were profitable or operated close to break-even, several large enterprises generated aggregate net losses that fluctuated at around 1% of GDP in 2016–2024.
The fund linked part of the losses to the cost of servicing debt denominated in foreign currency. The IMF also noted that SOEs’ quasi-fiscal activities and weak enforcement of hard budget constraints remain largely unresolved problems.
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Oversight and corporate governance
The fund positively assessed the strengthening of financial oversight by Ghana’s Ministry of Finance and the development of fiscal risk assessment. At the same time, it drew attention to delays in data submission, its incompleteness, and problems with integrating assessment procedures.
There are two parallel fiscal risk reports at the ministry: the Fiscal Risk Statement and the SOE fiscal risk report. According to the IMF’s conclusion, these documents partly duplicate each other, while the report on state-owned companies has significant data delays and does not sufficiently focus on enterprises that are critical for the macroeconomy.
The IMF also noted that financial oversight powers are divided between the Ministry of Finance and SIGA — the State Interests and Governance Authority, established in 2019. In the fund’s view, this leads to duplication of functions and fragmented reporting. Separately, the IMF stated that appointments to boards of directors and executive positions are politicized, and that compliance with requirements for reporting, audits, and performance contracts is uneven.
