IMF cautions Ghana over energy sector despite progress made in reducing energy debt
According to the Fund, the energy sector shortfall remains sizeable estimated at US$1.1 billion in 2026, reflecting high collection and distribution losses and costly generation contracts with capacity charges and “take-or-pay” clauses.
The International Monetary Fund (IMF) has issued a cautious outlook for Ghana's energy sector, acknowledging the strides made in reducing energy debt but highlighting ongoing challenges. The IMF notes that the energy sector shortfall, which measures the gap between revenues and costs, stands at US$1.1 billion in 2026, a figure that underscores persistent issues such as high collection and distribution losses and the burden of costly generation contracts.
Despite improvements, including tariff adjustments, higher payments to energy suppliers, cedi appreciation, and renegotiated agreements, the sector still faces significant fiscal risks. These issues are further compounded by institutional gaps, such as uneven enforcement of tariff adjustments and Cash Water Mechanism guidelines, which could lead to instability, especially during electoral periods.
The IMF emphasizes that while progress has been made, substantial fiscal support and institutional reforms will be necessary to transform the energy sector into a driver of inclusive growth.
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