Energy Minister John Abdulai Jinapor raised alarms about Ghana’s energy sector debt, now GH¢80 billion. He urged for immediate measures to tackle this financial crisis, emphasizing the need for collaboration with Civil Society Organizations. Warnings from other officials suggest significant increases in debt if no action is taken. The IMF labels this sector as a major financial risk, reinforcing the urgency for reforms and sustainable solutions.
John Abdulai Jinapor, Minister for Energy and Green Transition, has expressed alarm over the escalating debts in Ghana’s energy sector, now totaling GH¢80 billion. During a meeting with Civil Society Organizations (CSOs) on March 18, 2025, he revealed that the Electricity Company of Ghana (ECG) constitutes over GH¢60 billion of this debt. Mr. Jinapor condemned the growing financial liabilities as unsustainable and called for immediate remedial actions.
The Minister emphasized the urgency of the situation, stating, “The rate at which debts are piling up in the energy sector makes it imperative to take drastic measures. If we do not act now, we risk a major crisis.” He pinpointed financing challenges and encouraged CSOs to generate innovative ideas and proposals to help restructure the financial obligations of the sector.
Mr. Jinapor’s concerns align with warnings from Finance Minister Dr. Cassiel Ato Forson, who indicated at a national economic dialogue on March 3, 2025, that the energy sector debt could escalate to $9 billion (GH¢126 billion) by 2027 without immediate intervention. Dr. Forson advocated for structural reforms to mitigate further deterioration of the financial environment.
Additionally, the International Monetary Fund (IMF) has identified Ghana’s energy sector as a significant financial risk, disclosing that legacy debts amounted to $2.1 billion (GH¢29.4 billion), representing 2.8% of Gross Domestic Product (GDP) as of December 2023. In light of these serious concerns, Mr. Jinapor reassured CSOs of the government’s commitment to pursue sustainable solutions for sector stabilization, stressing the importance of transparency and Inclusive stakeholder engagement in addressing energy challenges.
The escalating debt within Ghana’s energy sector demands urgent intervention to prevent a financial crisis, as articulated by Minister Jinapor. With debts now reaching GH¢80 billion and warnings from various officials regarding potential increases, the necessity for structural reforms and collaborative solutions is paramount. The government’s commitment to transparency and stakeholder engagement is essential in navigating these challenges while ensuring the sustainability of the energy sector.
Original Source: www.gbcghanaonline.com