President John Dramani Mahama has assured that his government would fix the economic malaise that had plagued the country over the last few years.
Delivering his maiden address on the state of the nation to Parliament in Accra yesterday, President Mahama said Ghana’s economy was in crisis on many fronts, adding that “the state of the nation is not good.”
According to him, the economy was saddled with staggering debts to the tune of GH¢721 billion with several state-owned enterprises in debt, including the ECG and COCOBOD who owe GH¢68 billion and GH¢32 billion respectively.
“Mr Speaker, inspired by the almighty God and propelled by the massive mandate given me by the good people of Ghana, I am moved to make a purposeful and bold declaration that, I, John Dramani Mahama, will fix the economic crisis confronting our country and reset it on a path of growth and prosperity,” he said to loud cheers from the majority caucus of the legislative assembly.
He explained that in the 2023/2024 crop season for instance, COCOBOD could not supply 333,767 tonnes of cocoa, which it sold at US$ 2,600 per tonne, resulting in a roll-over into the 2024/2025 cocoa season.
“This implies that for every tonne of cocoa delivered this year in fulfilment of the rolled-over contracts, COCOBOD and the Ghanaian farmer would lose US$ 4,000 in revenue,” he revealed.
As of yesterday, he said the COCOBOD had supplied 210,000 tonnes out of the rolled-over contract, resulting in a revenue loss of US$840 million for both COCOBOD and the Ghanaian farmer with the farmer expected to lose another US$495 million when the Board finishes supplying the remaining rolled-over contracts.
The energy sector, President Mahama said faced significant financing challenges primarily due to collection and system losses, non-compliance with the Cash Waterfall Mechanism, and legacy debts.
“The financing shortfall has risen considerably to approximately US$2.2 billion or GH¢34 billion for 2025, and urgent measures will be needed to reduce it to sustainable levels and ultimately eliminate it,” he stated.
President Mahama said the financial sector continues to struggle despite the previous government reportedly spending GH¢29.9 billion on the financial sector clean-up exercise.
“They also left scant reserves for debt servicing despite implementing what may be considered the most severe and distressing economic policy in the annals of the Fourth Republic, if not in the entirety of our nation’s history—the Domestic Debt Exchange Programme,” he said.
The above, he recalled, was a stark contrast to what pertained in 2017 when his government allocated US$250 million to the Sinking Fund to service debt.
The President said despite claims by the previous government of having left buffers for debt repayment, the statement of accounts for the Debt Service Reserve Account, shows a balance of only US$64,000 and GH¢143 million in the dollar and Ghana cedi accounts respectively.
The repercussions of the reckless debt accumulation and economic mismanagement, he noted, would require extensive work and sacrifice to repair.
In the next four years, the President stated that debt servicing would amount to GH¢280 billion, comprising GH¢ 150 billion for domestic and GH¢130 billion in external debt servicing.
The debt position, he said has severely impacted infrastructure projects that should have been completed with 55 stalled projects due to the default of debt and subsequent restructuring, with a total amount of US$2.95 billion not disbursed.
“Notwithstanding this gloomy background, I remain committed to leading this government, taking every necessary step to reset our economy, getting things back on track, and working with the good people of our country to build the Ghana we want,” President Mahama pledged.
