ECG, energy sector flagged over procurement and financial breaches – IMF
The energy and roads construction sectors have been identified among areas with significant financial and procurement weaknesses, with the IMF warning that breaches of public financial management rules could expose government to additional fiscal risks.
The International Monetary Fund (IMF) has flagged significant financial and procurement weaknesses in the energy and roads construction sectors, warning that breaches of public financial management rules could put extra fiscal pressures on the government. According to the IMF Technical Assistance Report, over 15 percent of payables and 6.4 percent of procurement commitments in these sectors were found to be in violation of public financial management regulations or statutory requirements.
The report particularly highlights the Electricity Company of Ghana (ECG), with procurement and contractual weaknesses identified. A Ghana Audit Service performance audit revealed that ECG procured electricity meters worth around US$145 million through 50 contracts without adhering to the Public Procurement Act. Additionally, the report raises concerns over unsolicited "take-or-pay" Power Purchase Agreements, which have led to generation capacity exceeding actual national demand.
Such arrangements have created persistent financial obligations that continue to strain the energy sector and public finances.
IMF officials argue that stronger oversight of state-owned enterprises (SOE) procurement, contracts, and financial commitments is essential to contain fiscal risks and ensure SOEs operate within public financial management and statutory requirements.
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