The Minister of Finance, Dr. Cassiel Ato Forson, has painted a bleak picture of Ghana’s economy as he presented the 2025 Budget Statement and Economic Policy to Parliament on Tuesday.
According to him, the Mahama administration inherited an economy “in deep crisis,” characterized by severe fiscal challenges, ballooning arrears, and missed economic targets under the ongoing IMF program.
Dr. Forson revealed that Ghana’s inflation worsened in 2024, rising from 23.2% in 2023 to 23.8% by the end of the year, far exceeding the budget target of 15%. Additionally, the country’s primary balance on a commitment basis deteriorated from a deficit of 0.2% of GDP in 2023 to a staggering 3.9% in 2024.
“The economic distress we have inherited is unprecedented,” he stated. “Massive arrears, reckless public spending, and missed IMF benchmarks have created a daunting fiscal landscape that demands urgent and bold reforms.”
He further disclosed that Ghana’s total outstanding arrears had reached GH₵67.5 billion, including debts owed to government contractors and suppliers. The amount excludes a $1.73 billion debt owed to Independent Power Producers (IPPs), a GH₵68 billion debt owed by the Electricity Company of Ghana, and a GH₵32 billion debt owed by COCOBOD.
Beyond these arrears, he warned of Ghana’s growing domestic debt service obligations, which stand at GH₵150.3 billion over the next four years, with GH₵57.6 billion due in 2027 alone. “These obligations present significant risks to Ghana’s fiscal stability, but we are committed to addressing them with prudent financial management,” he assured Parliament.
Despite the grim outlook, Dr. Forson maintained that the Mahama administration is determined to stabilize the economy and implement structural reforms. As part of its strategy, the government will conduct a comprehensive audit of all arrears to validate payments and enforce fiscal discipline through the full implementation of the Public Financial Management Act.
“This is a defining moment for Ghana,” he declared. “We have a choice: either continue on a path of economic decline or embark on the difficult but necessary journey of reform and transformation. Under President Mahama’s leadership, we will fix this economy.”
