World Bank says Ghana’s financial problems are mainly due to poor budget management, which has led to uncontrolled government spending, rising interest payments, and financial struggles.

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In its latest Public Finance Review, the Bank explains that heavy spending during election years, expensive bailouts in the financial and energy sectors, and costs related to the COVID-19 pandemic have put a huge strain on Ghana’s finances. As a result, the government has little money left for important development projects.

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Between 2010 and 2023, almost 70% of government spending went to salaries for public sector workers, interest payments on loans, and mandatory expenses, leaving little for infrastructure and economic growth.

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Rising borrowing costs have also made it harder to invest in crucial projects.

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The report stresses that Ghana must improve its financial management by increasing domestic revenue, reducing unnecessary tax breaks, and enforcing stricter spending controls.

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If these changes are not made, the World Bank warns, Ghana could lose recent economic progress and remain in financial trouble for a long time.

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To ensure stability, the government needs to cut unnecessary spending, improve financial oversight, and adopt a stricter budget system to rebuild investor confidence and encourage long-term growth.

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