“We inherited an economy in deep crisis” – Ato Forson

The Finance Minister, Dr. Cassiel Ato Forson, has painted a grim picture of the economy, citing massive debts, unpaid government obligations, and an unsustainable fiscal position.

Speaking on the floor of Parliament on Tuesday, during the presentation of his administration’s foremost budget, the minister stated,

“Mr. Speaker, we inherited an economy in deep crisis, hard hit with debt and beset by other fiscal challenges such as a large accumulation of MDA arrears, energy sector financing shortfalls, and large fiscal risks from the cocoa and financial sectors.”

According to the budget statement, Ghana’s total central government arrears and outstanding payments amounted to GH¢67.5 billion by the end of 2024, with the road sector alone accounting for GH¢21 billion.

Additional liabilities include US$1.73 billion owed to Independent Power Producers (IPPs), GH¢68 billion owed by the Electricity Company of Ghana (ECG), GH¢32 billion owed by the Ghana Cocoa Board (COCOBOD), and GH¢5.75 billion owed by the Road Fund.

The finance minister emphasized that these financial challenges, coupled with a deteriorating exchange rate and high inflation, necessitate urgent reforms.

“Weak commitment control systems and reckless public spending have reversed the progress made in fiscal consolidation,” he noted.

To address the crisis, the government has announced plans to audit all outstanding arrears before payments are made, ensuring transparency and value for money.