GHANA – TOWARDS CREATING A DYNAMIC AND DIVERSIFIED ECONOMY, GREENER JOB OPPORTUNITIES FOR A MORE RESILIENT AND INCLUSIVE SOCIETY: THE WORLD BANK GROUP IN GHANA
Ghana sits on the Atlantic Ocean and borders Togo, Côte d’Ivoire, and Burkina Faso. Its population is about 34.4 million (2024). In the past two decades, it has taken major strides towards democracy under a multi-party system, with its independent judiciary winning public trust.
President John Dramani Mahama was elected in the December 2024 elections. Mr. Mahama’s administration faces a challenging environment in leading Ghana on a path of debt sustainability by enhancing fiscal discipline, expanding tax revenue, and completing the debt restructuring with external creditors under the IMF program.
Recent economic developments
The country faced a surge in public debt exacerbated by fiscal measures taken in response to external shocks, which resulted in losing access to international financial markets. To tackle these challenges, Ghana implemented substantial macroeconomic policy adjustments, including comprehensive debt restructuring and fiscal consolidation. Maintaining the recovery will require ongoing advancements in tax policy, revenue administration, public financial management reforms, and structural reforms in the energy and cocoa sectors. The government’s program is supported by an IMF Extended Credit Facility, and by the World Bank’s Development Policy Operations.
Weak economic growth, limited government spending, and high inflation—particularly in food prices—have worsened living standards, pushing more people into poverty, and increasing the risk of food insecurity. Maintaining economic growth around its potential rate of 5% will require macroeconomic stability. In the longer term, structural reforms aimed at promoting private sector development and increasing the attractiveness of foreign direct investment (FDI) are necessary to raise the country’s growth potential. Critical reforms include strengthening the insolvency regime, access to finance, the energy sector, and the legal and regulatory environment faced by foreign direct investors. Accelerating digitalization and harnessing the opportunities offered by the Africa Continental Free Trade Agreement (AfCFTA) through integration with global value chains will also be important in this regard.
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