Senior Research Fellow at the Institute of Economic Research and Public Policy (IERPP), Dr. Frank Bannor, has expressed concerns over fiscal sustainability amid the 2026 Budget’s ambitious infrastructure and agricultural spending plans.
Speaking on Morning Starr with Naa Dedei Tettey on Monday, November 17, Dr. Bannor highlighted the heavy burden of interest payments.
He said, “If you check the 2026 budget, servicing of interest payment is second on government’s expenditure outline, second to compensation. If you look at 2026, the government has projected an amount of GHC57 billion in servicing loans, interest on loans. And out of this GHC57 billion, an amount of GHC 50 billion is to be used for servicing the interest domestic.”
He cautioned that such high levels of domestic borrowing could crowd out private investment, potentially undermining the government’s efforts to stimulate job creation through the private sector.
Dr. Bannor also noted that the projected fiscal deficit may exceed the minister’s target of 1.5%, emphasizing that careful monitoring and execution are essential to maintain macroeconomic stability.
He analysed that while the budget aims to stimulate economic activity, its success will depend on disciplined fiscal management and effective implementation.
His remarks come after Finance Minister Casseil Ato Forson presented the 2026 Budget on Thursday, November 13, 2025, which included key reforms such as the launch of a US$500 million Oil Palm Development Finance Window to support smallholders, create jobs, and boost sustainable production.
Source: Starrfm.com.gh
