Finance Minister, Dr Cassiel Ato Forson, has described the energy sector as the biggest economic threat currently facing the country.
Speaking during a deep-dive session on the Ghana Energy Compact under Mission 300 at the World Bank, he warned that the sector is grappling with a financial shortfall of approximately $2 billion annually.
Dr Forson, stressed that the magnitude of the shortfall surpasses Ghana’s domestic capital expenditure and must be treated with urgency.
He said the crisis cannot be resolved through tariff adjustments alone, pointing instead to the need for comprehensive reforms across the entire energy value chain.
“The problem is not just tariffs. The inefficiencies, especially in the distribution sector, are being passed on to the ordinary Ghanaian, making electricity costs unnecessarily high,” the Minister stated.
He added that the Electricity Company of Ghana (ECG) could reduce the shortfall by half if it addresses these inefficiencies.
To address the challenges, he disclosed that Cabinet has approved private sector participation as part of government’s strategy to revive the sector.
Additionally, a Legislative Instrument (LI) has been submitted to Parliament to allow for competitive procurement of power generation services.
Dr Forson, described the Ghana Energy Compact as a timely intervention and called for its rapid implementation. “The compact has come at the right time. It will in the long run assist Ghana, and we are praying the process is not delayed,” he said.
He concluded with a strong appeal for urgency from all stakeholders. “Time is of the essence. We must act quickly if we are to prevent further damage to our economy and improve the lives of Ghanaians.”