By Francis Ntow
Accra, July 22, GNA – Ghana is unlikely to announce major policy changes in Thursday’s mid-year budget review as fiscal consolidation remains the Government’s overriding priority, Professor Godfred Alufar Bokpin, economist, says.
He said the review was expected to focus on revenue performance, expenditure execution and implementation of reforms under the International Monetary Fund’s (IMF) Policy Coordination Instrument (PCI), rather than any change in the Government’s fiscal strategy.
Prof. Bokpin, a lecturer at the University of Ghana Business School (UGBS), said this in an interview with the Ghana News Agency ahead of the Finance Minister’s presentation of the 2025 mid-year budget review.
He said the Government had already signalled its intention to pursue fiscal consolidation throughout 2025 and 2026 before gradually easing expenditure from 2027, making any significant policy shift unlikely.
“The government already signalled markets and the public that it would pursue austerity for about two years, spanning 2025 and 2026, before progressively easing spending from 2027,” he said.
The mid-year budget review, presented under Section 28 of the Public Financial Management Act, 2016 (Act 921), provides an update on revenue and expenditure performance, implementation of government policies and programmes, and revisions to macroeconomic assumptions where necessary.
Prof. Bokpin said the review should also provide an update on the nearly 20 reforms under the IMF’s PCI ahead of the Fund’s Executive Board meeting later this month to review Ghana’s programme.
He observed that although inflation had outperformed the Government’s 2025 target, the authorities had maintained their original projections, indicating that the fiscal consolidation framework would remain unchanged.
On revenue mobilisation, Prof. Bokpin urged the Finance Minister to provide an update on the performance of recent tax measures, including the harmonisation of the flat Value Added Tax (VAT) rate with the standard rate of 20 per cent, together with the administrative and compliance reforms introduced to strengthen tax collection.
He also identified first-quarter budget execution, which he said stood at about 70 per cent, as an important indicator of the Government’s spending outlook for the second half of the year.
Prof. Bokpin said it was important for the Government to demonstrate ownership of the PCI reforms by outlining measures that would sustain recent macroeconomic stability beyond the IMF-supported programme.
“stability is not an end but a foundation. From stability, the country must build resilience, and from resilience move toward structural and productivity transformation – a process that will take time.”
Prof. Bokpin said Ghana’s Medium-Term Revenue Strategy, anchored in the National Revenue Policy, showed that IMF-supported reforms had yet to significantly strengthen domestic revenue mobilisation.
Although the strategy targets a tax-to-GDP ratio of between 18 and 20 per cent by 2028, Ghana’s current ratio remains around 14 per cent, underscoring the challenge of expanding domestic revenue sufficiently to reduce dependence on external support, he said.
Prof. Bokpin said the persistent revenue gap meant Ghana could not yet claim to have outgrown external financial support, despite the cushion provided by gold-backed foreign exchange reserves held by the Bank of Ghana.
He recommended that the Government complement the PCI by accessing the IMF’s Resilience and Sustainability Facility (RSF), a concessional financing mechanism already utilised by several African countries, including Kenya.
“Signing on to the PCI without funding attached, simply moves the country from the emergency ward to the recovery ward of IMF support – not fully out of it. The government must secure the Board’s backing and pursue concessional climate financing without delay,” he said.
Prof. Bokpin said the RSF would provide Ghana with dedicated financing to address coastal erosion and other climate-related risks.
“These are challenges that the country lacks the political will to confront on its own,” he said, citing recent flooding as evidence of the country’s growing climate vulnerabilities.
Prof. Bokpin warned that delaying climate and revenue reforms would increase the cost of addressing those challenges and said the Government should take them into account in the mid-year budget review.
GNA
Edited by Kenneth Sackey
22 July 2026
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Reporter: Francis Ntow