Ghana’s energy sector debts have reached GH¢80 billion, primarily due to the Electricity Company of Ghana’s liabilities. Minister Jinapor warns of an impending crisis if no action is taken, urging CSOs to assist in restructuring financial obligations. Finance Minister Dr. Forson highlights the risk of debts escalating further without reforms, while the IMF underscores the sector’s financial vulnerabilities. The government is committed to seeking sustainable solutions.
In Ghana, the Minister for Energy and Green Transition, John Abdulai Jinapor, has highlighted urgent concerns regarding the escalating debt in the energy sector, which has now reached GH¢80 billion. He indicated that the Electricity Company of Ghana (ECG) alone is responsible for over GH¢60 billion of this total. The minister characterized this situation as unsustainable and called for immediate intervention to avert a financial crisis.
Mr. Jinapor emphasized the critical importance of prompt action, stating, “The rate at which debts are piling up in the energy sector makes it imperative to take drastic measures. If we do not act now, we risk a major crisis.” He pointed out that financing remains a significant challenge and encouraged Civil Society Organisations (CSOs) to present innovative ideas and proposals to help restructure financial obligations within the sector.
These sentiments align with warnings from Finance Minister Dr. Cassiel Ato Forson, who stated during a national economic dialogue on March 3, 2025, that the energy sector debt could escalate to $9 billion (GH¢126 billion) by 2027 without urgent reforms. Dr. Forson advocated for structural reforms to mitigate the worsening conditions of the sector.
Additionally, the International Monetary Fund (IMF) has identified Ghana’s energy sector as a major financial risk, noting that legacy debts have reached $2.1 billion (GH¢29.4 billion), equivalent to 2.8% of the Gross Domestic Product (GDP) as of December 2023. In response to these alarming figures, Mr. Jinapor conveyed the government’s commitment to pursuing sustainable solutions aimed at stabilizing the sector, emphasizing that transparency and broad stakeholder engagement will be crucial in overcoming the country’s energy challenges.
In summary, Ghana’s energy sector faces a significant crisis with debts totaling GH¢80 billion. Minister Jinapor has called for immediate action and collaboration with CSOs to address this financial strain. The warnings from Finance Minister Dr. Forson and the IMF underline the urgency of implementing structural reforms to avoid further deterioration. Government commitment to transparency and stakeholder engagement will be essential in stabilizing the sector’s financial health.
Original Source: www.gbcghanaonline.com
