The International Monetary Fund (IMF) is strongly urging Ghana to accelerate private sector involvement in the Electricity Company of Ghana (ECG). This call comes amid deep-seated problems in the energy sector that continue to put a strain on public finances and threaten economic stability. The IMF made this recommendation during its recent mission to Accra. The mission was for the sixth and final review of Ghana’s Extended Credit Facility program. This program aims to support the country’s economic recovery.
The IMF statement emphasised that protecting public resources requires bold reforms. It specifically pointed to tackling distribution and collection losses at ECG. The Fund suggested finalising private sector participation in electricity distribution. It also called for improved payment discipline. Clearing old debts and reducing the cost of generating electricity were also highlighted. These issues stem from persistent operational inefficiencies at ECG. Mounting debts and difficulties in collecting revenue are major concerns.
This intervention by the IMF fits into a broader economic picture for Ghana. The country has shown significant economic recovery gains. Inflation has fallen rapidly. Foreign reserves have improved. Confidence in the Ghanaian cedi has strengthened. Fiscal performance has also seen marked improvement. Economic growth exceeded expectations in 2025. This was driven by widespread economic activity and robust gold exports. However, the IMF warned that maintaining this progress depends on continued reforms and strict fiscal management. The global economic environment remains uncertain.
Ruben Atoyan led the IMF staff team during their mission. The team engaged with Ghanaian authorities between April 29 and May 15. The IMF’s statement noted that sustaining the economic recovery is crucial. The ongoing war in the Middle East could affect Ghana. Rising energy, food, and fertiliser prices pose risks to the economy. The IMF also revealed plans for a new support program. This would be a 36-month non-financing Policy Coordination Instrument (PCI).
This new arrangement will focus on maintaining fiscal adjustment. It will also safeguard the nation's ability to manage its debt. Strengthening the governance of state-owned companies is key. The IMF also wants to support inclusive economic growth. Transparency in quasi-fiscal operations, particularly at the Bank of Ghana, was stressed. Losses from the Domestic Gold Purchase Programme highlight risks. These can weaken the central bank's financial position. Reforms in the cocoa sector are also needed. These aim to boost efficiency and ensure COCOBOD’s long-term sustainability. The IMF recognised Ghana’s progress and the resilience of its people.
The implications of the IMF’s push for ECG privatisation are significant. It signals a critical juncture for Ghana’s energy sector reform. Decision-makers must weigh the potential benefits of private efficiency against concerns about national control. Markets will watch closely for government actions on this front. The success of future economic stability and investment hinges on these reforms. The IMF's focus on state-owned enterprises suggests a wider push for improved public finance management. This new PCI program will guide Ghana's economic policies post-bailout.