Ghana’s Finance Minister Calls for Urgent Economic Reforms

During the National Economic Dialogue, Finance Minister Dr. Cassiel Ato Forson emphasized the urgent need for structural reforms in Ghana’s economy. He pointed to the overreliance on commodities and alarming debt levels, while highlighting inefficiencies in public spending in education and health. Ato Forson urged for diversification and improved spending efficiency to cultivate sustainable growth, with dialogues expected to yield actionable solutions.

Dr. Cassiel Ato Forson, Ghana’s Finance Minister, provided a candid evaluation of the nation’s economic landscape during the National Economic Dialogue on March 3, 2025. He emphasized the critical necessity for structural reforms to overcome fiscal inefficiencies and foster sustainable growth. Despite a reported average growth of approximately 4.4% in recent years, this expansion has primarily stemmed from the oil and mining sectors, revealing inadequate structural transformation within the economy.

The Minister spotlighted the significant dependency on primary commodities, with over 85% of exports in 2024 originating from this sector. He expressed concern regarding the alarming increase in Ghana’s debt levels, which escalated from 20% of GDP in 2016 to 93% by 2022. Dr. Forson noted that continuous fiscal deficits, which exceeded 4% of GDP between 2008 and 2019, have exacerbated public finance challenges.

Moreover, he criticized the inefficiencies observed in public expenditure, particularly in education and healthcare. He pointed out that a mere one-quarter of educational funding is allocated to early childhood and primary education. In healthcare, less than 60% of the National Health Insurance budget is allocated for claim payments due to mismanagement of resources, which hinders effective healthcare delivery.

Dr. Forson advocated for decisive measures to diversify Ghana’s economy beyond its dependence on commodities. He asserted the urgent need for improved efficiency in public spending to foster investment in both infrastructure and social programs. “We must reset our economy by addressing these systemic challenges to achieve long-term resilience and inclusive growth,” he asserted. The dialogue will continue with stakeholders expected to propose actionable solutions for economic transformation and fiscal discipline.

In summary, the Finance Minister’s remarks underline the urgent reforms required to address Ghana’s economic struggles. The reliance on primary commodities, exacerbated by inefficiencies in public spending and rising debt levels, demands immediate attention. The emphasis on diversifying the economy and enhancing spending efficiency is critical for achieving sustainable growth and resilience in the nation’s economic framework.

Original Source: www.gbcghanaonline.com