By Jibril Abdul Mumuni
Accra, Aug. 11, GNA – The International Monetary Fund (IMF) has called for a major overhaul of Ghana’s State-Owned Enterprises (SOEs).
The Fund warned that many public institutions continued to pose risks to the country’s finances despite recent economic improvements.
The IMF said Ghana should undertake a strategic review of its SOE portfolio to determine which entities should remain under state ownership and which should be restructured, commercialised or divested.
It noted that while Ghana had made strong progress in restoring economic stability, weaknesses in some state-owned enterprises could undermine efforts to maintain fiscal discipline and debt sustainability.
The IMF’s latest Article IV Consultation Report noted that several SOEs continued to make losses and accumulate liabilities that could eventually become obligations of the Government.
It noted that SOE’s in the energy and cocoa sectors remained key sources of fiscal risk and required stronger oversight and reforms.
The Fund stressed that sustained implementation of SOE reforms would help reduce pressure on public finances, improve service delivery and support Ghana’s long-term economic development agenda.
It also urged the authorities to strengthen corporate governance in public enterprises through merit-based appointments to boards and management positions to improve efficiency, accountability and financial performance.
It recommended the timely publication of audited financial statements by state-owned enterprises and other public entities, which would ensure transparency and improve monitoring of financial risks and support informed decision-making.
The report forms part of discussions on Ghana’s proposed three-year Policy Coordination Instrument (PCI), which is expected to guide reforms after the completion of the country’s Extended Credit Facility programme.
Under the new arrangement, the government is expected to undertake reforms aimed at improving SOE governance and reducing fiscal risks.
The IMF said planned reforms included a review and reclassification of state-owned enterprises, publication of audited accounts and decisions on the restructuring or divestment of selected entities.
According to the Fund, strengthening oversight of public enterprises was critical to protecting Ghana’s recent gains in debt sustainability.
“The country’s risk of debt distress has improved to moderate following strong economic growth, fiscal consolidation and progress in debt restructuring,” it said.
The IMF also acknowledged progress in the banking sector, noting that state-owned banks such as the Agricultural Development Bank, Consolidated Bank Ghana and National Investment Bank had been recapitalised to meet regulatory requirements.
However, continued reforms were needed to address governance and operational challenges in parts of the financial sector, it added.
GNA
Edited by Agnes Boye-Doe
Reporter: Jibril Abdul Mumuni