By: Nana Karikari, Senior Global Affairs Correspondent
Ghana’s state-owned enterprises continue to face profound governance challenges stemming from political interference in leadership selections.
According to an International Monetary Fund Technical Assistance Report released September 9, 2026, appointments of boards and chief executives remain heavily politicized and centralized within the Presidency.
While formal frameworks exist to promote meritocracy, executive boards are largely dominated by political appointees, with board chairs frequently serving as active government ministers, Members of Parliament, or senior party officials.
The Fund noted that the Ghana Ports and Harbours Authority board was chaired by the national chairman of the governing party, a structure that persisted through the political transition in 2025.
Similarly, the Volta River Authority maintains prominent politicians on its governing board alongside technocrats and traditional leadership.
These practices depart sharply from Organization for Economic Cooperation and Development standards, which advise against active politicians serving on corporate boards and prioritize independent, professional majorities.
Accountability Deficits and Structural Weaknesses
The centralization of authority undermines the fundamental oversight functions required for effective corporate governance. Chief executive officers are typically appointed directly by the President or relevant ministers rather than undergoing competitive selection processes managed by independent boards.
This dynamic dilutes accountability between oversight bodies and executive management. The absence of transparent selection criteria, coupled with limited public disclosure of board evaluations, increases vulnerability to political pressure.
Additionally, institutions like the Ghana Cocoa Board operate with a politicised committee ecosystem, where senior political figures lead critical internal divisions such as the Finance Committee.
The IMF emphasizes that such heavy political involvement restricts institutional independence, making it difficult to harmonize commercial objectives with broader social responsibilities.
Escalating Liabilities and Macroeconomic Pressures
Governance shortcomings translate directly into severe fiscal vulnerabilities across the state enterprise portfolio. Total aggregate liabilities reached approximately GH¢282 billion by 2024, representing about 25 percent of Gross Domestic Product.
The ten largest state enterprises account for roughly 85 percent of these total obligations, with the Electricity Company of Ghana alone contributing GH¢71 billion, or 6 percent of GDP. Other major entities, including the Volta River Authority and the Ghana National Petroleum Corporation, concentrate significant leverage within the sector.
Much of this debt is denominated in foreign currencies or backed by government guarantees, particularly through complex power purchase agreements.
The Bretton Woods institution noted that these arrangements “magnify the foreign-exchange and refinancing risks and link the SOEs’ balance sheets closely to the sovereign’s own debt position.”
Persistent Financial Strain Despite Sector Reforms
Substantial legislative and institutional reforms over the past decade have not yet yielded corresponding improvements in overall financial performance.
Although total enterprise revenues grew from GH¢19 billion in 2015 to GH¢133.7 billion in 2024, asset growth has been vastly outpaced by liability accumulation. Net losses have consistently hovered around 1.0 percent of GDP annually, driven largely by financing costs on foreign-denominated debt, liquidity constraints, and non-cost-reflective tariffs.
The Fund observed that “despite many entities operating profitably or around break-even point, a few large SOEs continue to drive the portfolio into net losses.”
Compounding these operational hurdles are fragmented institutional responsibilities between the Ministry of Finance and the State Interests and Governance Authority, alongside opaque quasi-fiscal activities that obscure true financial health.
Pathways Toward Professionalization
Addressing these systemic vulnerabilities requires translating existing policy frameworks into rigorous, practical execution.
The State Ownership Policy empowers the State Interests and Governance Authority to build structured nomination mechanisms, yet implementation remains in early stages.
Experts recommend accelerating merit-based vetting procedures, progressively replacing active politicians with independent technical specialists, and instituting mandatory corporate governance training for directors. Strengthening audit compliance, enforcing strict budget constraints, and clarifying institutional oversight boundaries are essential steps to insulate public assets from political cycles and safeguard national fiscal stability.
Elevating Institutional Sustainability
Securing long-term economic resilience demands that structural oversight mechanisms evolve beyond symbolic compliance to enforce genuine fiduciary discipline. Aligning operational execution with transparent public accountability ensures that state enterprises function as engines of national development rather than latent fiscal liabilities.
