- Ghana’s GH¢19.80bn SOE Profit Boom Comes with a Currency Warning
Ghana’s state-owned enterprises recorded one of their sharpest financial turnarounds in recent years, swinging from a combined GH¢2.26 billion net loss in 2024 to GH¢19.80 billion in net profit in 2025, but the headline improvement masks a heavy dependence on favourable foreign-exchange movements.
Professor Michael Kpessa-Whyte, Director-General of the State Interests and Governance Authority, has acknowledged that currency movements played an unusually large role in the performance, saying more than half of reported profit margins were shaped largely by foreign-exchange gains. That admission does not invalidate the consolidated result, but it changes the question policymakers and taxpayers should be asking: whether SOEs became structurally more profitable or benefited temporarily from a favourable currency cycle.
The significance of the exchange-rate effect becomes clearer in the sector’s currency numbers. According to SIGA’s analysis, the cedi strengthened from about GH¢14.70 to the US dollar at the end of 2024 to GH¢10.45 by December 2025, reducing the local-currency value of foreign-denominated liabilities carried by several state enterprises.
The sector consequently recorded GH¢11.72 billion in net foreign-exchange gains in 2025, compared with a GH¢12.01 billion forex loss a year earlier, representing a swing of approximately GH¢23.73 billion. Consolidated finance costs also fell by 42.49%, providing another substantial boost to reported profitability.
The improvement was not entirely an accounting consequence of currency translation. Aggregate revenue increased 28.12% to GH¢176.43 billion, while profit before interest and tax reached GH¢25.49 billion, with agriculture, manufacturing and infrastructure among sectors showing strong revenue expansion.
Those figures suggest genuine operational improvement in parts of the SOE portfolio. But they also make it necessary to distinguish between earnings generated from higher sales, efficiency and productivity and gains resulting from the revaluation of foreign-currency liabilities.
Policy analyst Bright Simons has challenged the strength of SIGA’s turnaround narrative on precisely that basis. According to his analysis cited in the document, stripping out currency revaluations would show underlying net profit falling from GH¢9.75 billion to GH¢8.08 billion, a decline of 17.13%, while operating profit fell 22.70% and the operating margin narrowed by 3.50 percentage points.
The contrasting interpretations are not necessarily mutually exclusive. SIGA is reporting the consolidated financial outcome recorded by the enterprises, while the alternative analysis asks a different question: how much of that improvement came from changes in the underlying businesses rather than macroeconomic conditions.
That distinction matters because the ultimate fiscal test of an SOE turnaround is not the accounting profit alone. A stronger public-enterprise sector should ideally generate cash, pay dividends, reduce dependence on government support, improve service delivery and strengthen balance sheets.
On that measure, the report presents a more complicated picture. Dividend payments to government fell 29.36%, with only Ghana Reinsurance Company and TDC Company identified as paying a combined GH¢16 million in dividends despite the sector reporting close to GH¢20.00 billion in net profit.
That gap is important because accounting profit is not the same as distributable cash. SOEs may retain earnings for investment, debt service, working capital or other obligations, but the limited dividend conversion means the headline profit cannot automatically be treated as an equivalent fiscal windfall for the government.
Persistent weaknesses also remain below the aggregate numbers. Five SOEs identified in the report including the Electricity Company of Ghana, Ghana Cylinder Manufacturing Company, Ghana National Petroleum Authority, Graphic Communications Group and Ghana Digital Centre recorded losses in every year between 2021 and 2025, while six other entities, including AirtelTigo Ghana, GIHOC Distilleries and Tema Oil Refinery, continued to carry negative equity.
The sector is also highly concentrated. SIGA’s 2025 report covers 162 of 175 specified entities, but just 10 SOEs accounted for 79.22% of total assets and 81.09% of revenue, meaning movements at a relatively small group of large enterprises can disproportionately influence the consolidated picture.
That concentration increases the risk of reading too much into sector-wide averages. A strong outcome from a handful of large enterprises can coexist with persistent operational weakness, negative equity and financial stress elsewhere in the portfolio.
Currency conditions also cannot be assumed to remain favourable. The document notes that the cedi showed greater volatility in 2026 and had reportedly depreciated about 8.70% on average against major trading currencies by July, underscoring the possibility that part of the 2025 forex benefit could reverse.
If foreign-exchange appreciation contributed materially to SOE profitability in 2025, renewed depreciation could have the opposite effect by increasing the cedi value of foreign-denominated obligations and generating accounting losses. That makes operating margins, cash generation, debt management, productivity and service quality more reliable long-term indicators of reform than a single year’s net profit.
The appropriate benchmark for Ghana’s SOE reform agenda should therefore shift from profit recovery to profit quality. The GH¢19.80 billion outcome is significant, particularly given the revenue expansion and lower finance costs, but it should be treated as a starting point rather than proof that longstanding weaknesses in the public-enterprise sector have been resolved.
The next set of results will offer a more demanding test. If SOEs can sustain profitability while producing stronger cash flows, paying meaningful dividends, repairing negative equity positions and maintaining performance without relying on substantial forex gains, the case for a structural turnaround will be much stronger.
