Prof Bokpin urges transparency on ECG reforms, warns of fiscal risks
Economist and Professor of Finance, Prof. Godfred Bokpin, has called for greater transparency and broader national consultation over proposed reforms in Ghana’s electricity sector, warning that the persistent financial challenges facing the Electricity Company of Ghana (ECG) continue to pose a major risk to the country’s fiscal stability.
Ghana's economist and finance professor, Prof. Godfred Bokpin, has advocated for enhanced transparency and wider public involvement in proposed reforms within the country's electricity sector. Bokpin emphasized that the fiscal challenges faced by the Electricity Company of Ghana (ECG) have persisted for decades, unaffected by the current International Monetary Fund (IMF)-backed program.
He insisted that the long-standing issues of inefficiencies, losses, inadequate revenue collection, and financial obligations in power generation and distribution are not solely due to the IMF program. Instead, they reflect structural weaknesses that successive governments have struggled to resolve.
Bokpin cautioned against dismissing the data on the financial requirements to fulfill ECG's obligations, suggesting that projections and liabilities should be used to understand the scale of the problem and evaluate the effectiveness of reforms. He highlighted the cash waterfall mechanism as an area where the IMF-supported reforms have shown some improvement, as it ensures the proper distribution of revenues throughout the electricity supply chain.
Despite these advancements, Bokpin expressed concern over the substantial public funding needed to maintain the energy sector, noting that the additional budgetary allocations required could surpass the combined allocations to other crucial sectors such as health, education, and agriculture. He questioned whether Ghana could continue relying on government funding alone to address the issue, given that previous administrations have failed to implement necessary reforms due to political and institutional constraints.
Bokpin stressed that resolving Ghana's electricity sector problems would necessitate significant investments, particularly in reducing losses throughout the value chain. He clarified that substantial improvements in generation, transmission, and distribution efficiency could only be achieved through substantial infrastructure and system investments. However, determining the appropriate financing for such investments remained a challenge.
Written by urgent.news from MyJoyOnline Ghana's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
