Banking consultant Dr. Richmond Atuahene has warned that inefficiencies in Ghana’s State Owned Enterprises (SOEs) could unwind the fiscal gains from the just concluded International Monetary Fund (IMF) bailout.
In an analysis circulated to The High Street Journal, the corporate governance specialist described SOE underperformance as a structural fiscal risk capable of forcing renewed debt accumulation, fresh bailouts, and the materialisation of contingent liabilities on the central government balance sheet.
He pointed to the energy, utilities, and cocoa sectors as repeat offenders. The Electricity Company of Ghana (ECG) and the Ghana Cocoa Board (COCOBOD) have absorbed the largest share of state interventions through subsidies, equity injections, and debt absorption, while operational inefficiencies at the Ghana Water Company Limited continue to suppress revenue recovery through high production losses and weak billing.
Atuahene argued that many SOE debts sit outside the visible government balance sheet as contingent liabilities, becoming public debt only when guarantees are triggered. He described this as a “hidden debt pipeline” that historically tends to materialise during periods of fiscal stress.
Governance weaknesses sit at the centre of the problem. The analysis cited weak boards, limited managerial autonomy, poor disclosure, fragmented oversight across multiple state institutions, and political interference in appointments and procurement as factors that have entrenched soft budget constraints. Each, he said, makes future state rescues more likely than operational reform.
The warning lands as Ghana transitions from a US$3 billion Extended Credit Facility (ECF) into a 36 month non financing Policy Coordination Instrument (PCI). The Fund has identified contingent liabilities from SOEs and quasi fiscal activities as the largest residual threat to Ghana’s fiscal outlook, with specific concerns flagged in the energy sector and around the Bank of Ghana’s Domestic Gold Purchase Programme.
Atuahene cautioned that the borrowing limits and guarantee caps that contained fiscal risk under the IMF programme could relax once external monitoring eases. Underperforming SOEs may then accumulate debt in anticipation of future government rescue, recreating the fiscal slippages that triggered the most recent crisis.
He proposed stronger boards, cost reflective pricing, tighter performance contracts, and a credible threat of restructuring, privatisation, or public private partnership exposure for chronically loss making entities. Without these, he said, the SOE sector will remain a structural drain on public finances regardless of the PCI’s reform commitments.
Ghana’s most recent State Interests and Governance Authority (SIGA) report showed total SOE assets reached GH¢395.2 billion in 2024, up nearly 23 percent on the year. Liabilities grew faster, climbing 24.2 percent to GH¢281.9 billion, underscoring the gap between asset growth and operational performance that the consultant cited.
