Ghana’s stronger cedi is providing a misleading picture of state-owned enterprises' financial health. Banking and corporate governance consultant Dr. Richmond Atuahene warns that recent profit gains largely reflect favourable foreign exchange movements, not improved operational efficiency.
This concern follows the State Interests and Governance Authority’s 2025 State Ownership Report. The report showed state-owned enterprises (SOEs) moving from a GHS 2.25 billion net loss in 2024 to a GHS 19.80 billion net profit after tax in 2025. Aggregate revenue also increased from GHS 137.64 billion to GHS 176.43 billion, creating an impression of significant recovery.
These reported improvements align with Ghana's broader economic narrative of currency stability and fiscal consolidation. The cedi has shown resilience against major international currencies, providing some relief to businesses. However, Dr. Atuahene's analysis suggests this stability might be masking underlying vulnerabilities within the state sector. This situation could undermine long-term economic planning and investor confidence.
Dr. Atuahene emphasizes that these numbers require careful scrutiny. He stated, “If you dive deep into it, it’s not operational efficiency. It’s completely, it’s not operational efficiency.” This highlights a critical distinction between accounting profits driven by currency shifts and genuine gains from productivity or cost reduction.
The implications of this distinction are significant for Ghana’s financial stability. If the cedi depreciates, these foreign exchange-driven profits could quickly reverse. This would expose the true operational weaknesses of SOEs, potentially leading to renewed financial stress. Policymakers must consider this when evaluating the sector's performance and making future economic decisions.
The foreign exchange impact is clearly visible in the data. SOEs recorded GHS 11.72 billion in net foreign exchange earnings in 2025. This contrasts sharply with a GHS 12.01 billion foreign exchange loss in 2024. This represents a year-on-year swing of approximately GHS 23.73 billion. This swing alone exceeds the GHS 22.05 billion improvement between the sector’s 2024 net loss and 2025 net profit. While other factors contributed, currency conditions were undeniably crucial to the reported results.
Finance costs for SOEs also fell by 42.49%, offering additional relief to highly leveraged entities. While positive for balance sheets, lower financing costs do not automatically indicate improved commercial efficiency or productivity. Dr. Atuahene argues that policymakers should interpret these results with this distinction in mind. He warned, “If you are moved by foreign exchange gains by 60%, then you are not talking about efficiency.”
This warning extends beyond just state enterprises. Banks, utilities, and large companies with significant foreign currency assets or liabilities are also affected. A period of cedi appreciation can reduce the cedi value of foreign currency liabilities. It can also lower financing pressure and generate revaluation gains. However, these benefits are fragile and can disappear rapidly if the currency weakens. This is particularly true for businesses whose revenues are in cedis but whose debts or operating costs are linked to foreign currency.
Dr. Atuahene issued a stark warning about a potential reversal. He cautioned, “Should the cedi begin to go downwards, then you’ll begin to see that we have a big problem.” Such a scenario would directly impact Ghana’s banking system. Banks are central to the country's credit chain, holding exposure to government securities, private businesses, and state-owned enterprises. Many corporate borrowers remain sensitive to exchange rates, interest rates, and public-sector payment cycles.
A renewed cedi depreciation could transmit stress through multiple channels simultaneously. Foreign currency liabilities would become more expensive in cedi terms. Import-dependent companies could face higher operating costs. Weaker borrowers might become less able to service their bank loans. This interconnectedness underscores why cedi stability is more than just a macroeconomic headline. It is a vital component of financial sector stability, especially in an economy where currency stress has historically impacted government finances, corporate balance sheets, and the banking sector.