- ECG, COCOBOD and VRA Expose the Hidden Danger Inside Ghana’s Public Finances — IMF
Ghana’s state-owned enterprise problem has moved beyond the familiar story of companies making losses and turning to government for support.
A new International Monetary Fund technical assistance report paints a more structural picture: GH¢282bn in liabilities, politically influenced boards, weak procurement, poorly identified public-service obligations and large infrastructure investments that can ultimately migrate onto the sovereign balance sheet.
The Fund’s central warning is that Ghana has built much of the institutional framework needed to control these risks, but that framework has still not translated into consistently better financial outcomes.
The scale of the exposure explains why this matters for every taxpayer rather than only managers of public companies.
SOEs generated GH¢133.7bn in revenue in 2024, equivalent to 11.50% of GDP, and controlled assets worth about GH¢395bn, but their liabilities had climbed from GH¢35bn in 2015 to GH¢282bn, or roughly 25.00% of GDP, by 2024.
The IMF says the ten largest SOEs hold about 85.00% of sector assets and liabilities, making financial stress at a handful of institutions capable of becoming a macro-fiscal problem.
The most striking example is the Electricity Company of Ghana.
ECG recorded GH¢8.3bn in losses in 2024, despite GH¢36.1bn in reported operating revenue, while GH¢19.7bn of government payments to independent power producers and related obligations were recognised as grants and represented almost half of reported revenue.
The IMF calculates that ECG accumulated about GH¢26bn in losses over three years and warns that persistent weakness could ultimately force government into significant recapitalisation or debt assumption.
ECG’s balance sheet shows why the risk cannot be understood by looking only at conventional bank debt. Trade and other payables reached GH¢54.5bn, accounting for 76.80% of liabilities, while total liabilities approach 90.00% of assets once trade payables and tax obligations are included.
The utility itself estimates that about 40.00% of electricity placed on its network is effectively unbilled or uncollected through technical and commercial losses and non-metered consumption.
Across the wider portfolio, the IMF says losses remain heavily concentrated despite years of reform. SOE revenues rose from GH¢56bn in 2021 to GH¢133bn in 2024, yet aggregate losses deepened from GH¢1.7bn to GH¢9.7bn, while ten major entities generated more than 90.00% of total losses.
ECG alone accounted for about 85.00% of aggregate SOE losses in 2024, showing that Ghana does not necessarily have 50 equally distressed companies but a smaller number of systemically dangerous ones.
Finance costs are making the problem harder to escape. The IMF puts aggregate financing costs at GH¢9.4bn in 2024, almost six times the GH¢1.57bn in earnings before interest and tax generated by the largest SOEs, while foreign-currency liabilities expose companies to cedi depreciation and refinancing risk.
That means an enterprise can improve operations and still see those gains swallowed by debt servicing, exchange-rate movements and legacy obligations.
But the report’s most politically sensitive finding concerns who governs these companies. The IMF says Ghana’s formal ownership and corporate-governance framework is broadly aligned with international standards, yet board and chief executive appointments remain “highly political and centralized in the Presidency”, with major SOE boards containing significant numbers of political appointees.
It warns that politically dominated appointments can weaken board independence and create incentives for CEOs to respond more strongly to political principals than to the boards meant to hold them accountable.
That becomes more than a governance concern when companies control billions of cedis in assets, contracts and infrastructure expenditure.
The IMF found that some appointment processes lack sufficiently transparent merit-based criteria, competency profiles and standardised vetting, while public disclosure of appointment criteria and performance evaluations remains limited.
Its recommendation is direct: Ghana should introduce merit-based selection for boards and executives and progressively reduce the number of active politicians and senior public officials serving on SOE boards.
Procurement provides another window into the cost of weak controls. The report cites ECG’s use of multiple take-or-pay power contracts, many unsolicited, and an Auditor-General finding that the utility purchased US$145mn of electricity meters through 50 contracts without adherence to the Public Procurement Act; it also notes that COCOBOD directly awarded 87.00% of contracts within the COCOROADS programme.
These are not simply procedural failures: poor procurement can lock the state into costs that remain long after the officials who approved them have left office.
The IMF also identifies a quieter weakness: Ghana often does not clearly identify and cost the non-commercial obligations imposed on SOEs. Utilities may be required to provide services below cost, or institutions may undertake social programmes without full compensation from the budget, leaving what the Fund calls quasi-fiscal activities buried inside corporate accounts.
Unless those obligations are measured and transparently funded, policymakers cannot tell whether an SOE is losing money because it is badly managed or because government has deliberately required it to deliver an unfunded public service.
Infrastructure makes the stakes still larger. Ten infrastructure-focused SOEs invested more than GH¢14bn in physical assets in 2024, roughly equal to the domestically financed portion of Ghana’s budgeted capital investment, yet the IMF says routine maintenance spending among major infrastructure SOEs is far below the 2.00%-3.00% of replacement value considered a minimum benchmark across several asset classes.
The consequence can be a familiar Ghanaian paradox: government spends heavily to build assets, then underfunds maintenance until service deteriorates and expensive rehabilitation becomes necessary.
The Fund’s proposed remedy is therefore not wholesale privatisation or indiscriminate closure of state companies, but much harder financial and governance discipline.
It wants Ghana to focus oversight on macro-critical SOEs, publish fiscal risks alongside the budget, identify quasi-fiscal obligations, subject major projects to independent assurance and require infrastructure companies to disclose annual investment and funding plans.
Crucially, it argues that Ghana must move from having policies on paper to “enforceable, performance-based practices”, because repeated rules without consequences have not been enough to change outcomes.
That may be the report’s most important message for the government’s fiscal reset. Ghana can cut central-government spending, restructure debt and improve tax collection, but those gains remain vulnerable if ECG, COCOBOD, VRA and other strategic enterprises continue building liabilities that eventually return to the Treasury.
The real test of SOE reform is therefore no longer whether Ghana has a State Ownership Policy, SIGA, performance contracts and governance codes; it is whether politically difficult decisions can finally stop public companies from converting operational weakness, political interference and unfunded mandates into liabilities for the taxpayer.
