Finance Minister Dr. Cassiel Ato Forson has revealed that the John-Mahama administration inherited a severely distressed energy sector, grappling with annual financing deficits exceeding $1.5 billion.
Presenting the 2025 Mid-Year Budget Statement to Parliament on Thursday, July 24, 2025, Dr. Ato Forson described the Ghana energy sector as “bleeding” due to persistent financial gaps and deep-rooted structural inefficiencies.
He stressed that energy sector debt in Ghana has posed a major threat to the national economy since 2023.
“We inherited a bleeding energy sector with annual financing shortfalls over $1.5 billion,” Dr. Forson stated.
He attributed the crisis to several key factors: legacy energy debts, inefficient Power Purchase Agreements (PPAs), poor revenue collection mechanisms, and high operational costs throughout the power supply value chain.
Dr. Forson emphasised that these structural issues have strained public finances, undermined energy security in Ghana, and hindered the country’s economic recovery.
To address the crisis, the government has rolled out major energy sector reforms in Ghana, targeting financial sustainability and improved transparency. These initiatives include:
- Renegotiation of excessive Power Purchase Agreements
- Reduction of excess capacity charges
- Review and reform of energy sector governance structures
Dr. Forson reaffirmed the Mahama administration’s commitment to transforming Ghana’s power sector into a resilient and efficient foundation for national development.
He also disclosed an addition of $2.14 billion to its gross international reserves within six months without relying on any form of external borrowing.
“In just six months, even before the IMF disbursement and without external borrowing, we have added $2.14 billion to the country’s gross international reserves,” he stated.
Dr. Forson announced that Ghana’s gross international reserves stood at $11.12 billion by the end of June 2025, covering 4.8 months of imports. This marks a significant increase from the $8.98 billion recorded in December 2024, which covered four months of imports.
