President Mahama Reports Dire Economic Challenges Facing Ghana

President John Mahama delivered a concerning State of the Nation address, revealing a critical economic situation characterized by a low Sinking Fund balance, substantial debts, and stalled infrastructure projects. He emphasized the urgent need for remedial measures and announced plans for a National Economic Dialogue. Mahama expressed his dedication to resolving these issues and restoring economic stability despite the daunting challenges ahead.

In his inaugural State of the Nation address on February 27, 2025, President John Mahama reported a dire economic situation in Ghana. The Sinking Fund, which is supposed to safeguard debt repayment, currently holds a mere $64,000, contradicting claims of adequate reserves. He stated, “Our economy is in crisis, and our people are suffering unprecedented hardships.”

The President highlighted significant financial challenges in the energy sector, attributing them to debt accumulation, collection losses, and compliance issues. He warned of a looming financing shortfall of approximately $2.2 billion, underscoring the urgent need for remedial actions. Stating, “The repercussions of reckless debt accumulation and economic mismanagement will require extensive work and sacrifice to repair,” he noted that damage to infrastructure projects is also severe.

Citing the previous administration’s actions, he expressed concern over the scant reserves left for servicing debts, despite massive investments in a clean-up exercise for the financial sector. President Mahama mentioned that the awful status of debt servicing will total approximately GH¢280 billion over the next four years. He pointed out that 55 infrastructure projects are currently stalled due to these financial constraints.

The President proposed a National Economic Dialogue set for March 3rd and 4th to discuss these issues. He indicated that the Finance Minister would present budget estimates on March 11th, which would shed light on the economic crisis. “I understand why I was elected with such high voter confidence—to solve their problems,” he asserted, emphasizing his commitment to addressing these difficulties rather than lamenting them.

Reflecting on previous experiences, he recalled successfully overcoming power shortages in his past administration, saying, “I promised to fix it, and I did!” He maintained that he is determined to restore Ghana’s economy to a path of growth and prosperity. He declared, “I, John Dramani Mahama, will fix the economic crisis confronting our country.”

The President reflected on the alarming state of the economy, stating, “Our economy is in dire straits… the depths to which our economy and governance have sunk.” He cited a staggering national debt of GH¢721 billion and highlighted the significant liabilities of various state-owned enterprises.

In discussing the impact on agriculture, he lamented COCOBOD’s inability to meet contractual obligations, leading to substantial revenue losses for both the board and cocoa farmers. He stressed that despite the gloomy outlook, he remains committed to steering the nation towards recovery, stating, “I remain committed to leading this government, taking every necessary step to reset our economy.”

In summary, President John Mahama has conveyed a grave status of Ghana’s economy, with alarming debts and financial mismanagement. He advocates for an immediate economic dialogue and expresses determination to overcome the challenges presented by his administration’s predecessors. Despite significant hurdles facing various sectors, including energy and agriculture, his commitment to restoring economic stability remains resolute.

Original Source: www.ghanabusinessnews.com