Ghana’s state-owned enterprises showed encouraging signs of recovery in 2024, but critical weaknesses at the country’s largest institutions risk undermining broader economic gains, according to a new government report.
The Bank of Ghana’s negative equity position, mounting debts at major utilities, and persistent losses at the cocoa regulator represent systemic threats that could derail progress across the state enterprise sector, warns Prof. Michael Kpessa Whyte, Director-General of the State Interest and Governance Authority.
The 2024 State Ownership Report identifies four major trouble spots that pose particular risks to Ghana’s economic stability. The central bank’s negative equity undermines its ability to maintain financial stability while sending concerning signals to investors about the country’s macroeconomic resilience, financial analysts note.
In the utilities sector, the Electricity Company of Ghana faces ballooning debts driven largely by inefficient revenue collection and substantial system losses. Ghana Water Limited confronts similar financial imbalances that continue straining public resources.
The Ghana Cocoa Board presents perhaps the most pressing concern. The regulator responsible for the country’s top foreign exchange earner struggles with mounting debt, declining production levels, and the substantial costs of financing rural infrastructure projects known as “cocoa roads.”
“The Bank of Ghana’s negative equity, the mounting debts of the Electricity Company of Ghana and Ghana Water Limited, along with COCOBOD’s challenges of debt, low production, and costly cocoa roads, continue to undermine the progress made by other State Enterprises,” the report states.
These institutional weaknesses threaten to overshadow improvements in other sectors, including transport, agriculture, finance, and energy. When the largest state enterprises underperform, their weight can drag down the entire portfolio’s progress, officials warn.
The impact extends directly to ordinary Ghanaians. ECG’s financial troubles can translate into unreliable electricity supply and higher tariffs, while COCOBOD’s inefficiencies threaten farmer incomes and national cocoa revenues. The central bank’s weak balance sheet raises risks of increased inflation and currency instability.
SIGA is implementing comprehensive reforms to address these challenges. The authority has introduced a new State Ownership Policy and updated Code of Corporate Governance designed to strengthen management accountability across specified entities. Capacity-building programs for boards and executives aim to instill stronger corporate discipline throughout the sector.
“With the introduction of key policy documents such as the State Ownership Policy for Specified Entities and the Code of Corporate Governance, along with efforts to enhance the capacity of boards and management, SIGA is well-positioned to accelerate transformative reforms,” according to the report.
The findings underscore the delicate balance Ghana faces as it seeks to maintain momentum in state enterprise reform while addressing deep-rooted problems at its most critical institutions. Success in resolving these systemic issues could unlock broader economic gains, while continued weakness risks derailing the country’s recovery efforts.
For Ghana’s economy, the performance of these major state institutions represents more than accounting concerns. They form the backbone of essential services and economic infrastructure that millions of citizens depend on daily.
