The International Monetary Fund (IMF) has endorsed the introduction of a GH¢1 per litre levy on refined petroleum products, which takes effect on June 16, 2025.
The levy, part of the amended Energy Sector Shortfall and Debt Repayment Levy, is aimed at generating critical revenue to address the growing debt crisis within Ghana’s energy sector.
Ghana currently records a GH¢2 billion monthly deficit in the energy sector. The government is grappling with US$3.7 billion in sector-wide debt, including over US$1.7 billion owed to Independent Power Producers (IPPs).
A heavy reliance on thermal power generation, coupled with over US$1.1 billion annually spent on liquid fuel purchases, has further strained the system. Yet, the cost of these fuels is not included in electricity tariffs, leading to a growing funding gap.
IMF Director of Communications, Julie Kozack, affirmed that the fuel levy would support Ghana’s ability to meet its fiscal targets under the ongoing bailout program
“This is a new measure that will help generate additional resources to tackle the challenges in Ghana’s energy sector and bolster Ghana’s ability to deliver on the fiscal objectives under the program.”
She also acknowledged the cedi’s recent appreciation and indicated that it could influence future program adjustments
“Future program reviews will provide an opportunity for the team to carefully assess all evolving macroeconomic and financial conditions, including exchange rate movements, to ensure that the program’s targets and objectives remain appropriate and achievable.”
Ghana is set to receive a US$370 million disbursement in early July 2025, pending approval by the IMF Executive Board. This will mark the fourth disbursement under the Extended Credit Facility (ECF) program, raising total IMF support to US$2.4 billion since May 2023.
