STATEMENT BY THE INSTITUTE OF PUBLIC POLICY & ACCOUNTABILITY (IPPA) ON THE 2026 BUDGET AND ECONOMIC POLICY PRESENTED BY THE MINISTER FOR FINANCE

The Institute of Public Policy & Accountability (IPPA) has reviewed the 2026 Budget Statement and Economic Policy presented to Parliament by the Minister for Finance on 13th November 2025. We commend the Minister for sustaining continuity in several key economic reforms initiated within the framework of the IMF-supported programme. Policy continuity in fiscal consolidation, debt restructuring, and monetary coordination remains essential for stabilising the Ghanaian economy. These measures have yielded remarkable improvements in macroeconomic indicators in the 2025 fiscal year. Real GDP growth for 2025 stood at 6.3%, inflation fell from 23.8% in 2024 to a single digit of 8.0% in 2025, and public debt declined sharply from 69.0% of GDP to 45%, a favourable trajectory that had already begun prior to 2025.

Public Debt-to-GDP Ratio
The ratio had already declined significantly from 78.5% in 2021 to 61.8% in 2024, according to Appendix 10A: Public Debt Statistics of the 2026 Budget Statement. This demonstrates that the downward trend predates the current administration’s stewardship.

GDP Growth Rate
GDP growth improved from 0.5% in 2020 to 5.7% in 2024 (Appendix 1C of the 2026 Budget Statement). This strong rebound reflects recovery measures implemented by the previous Government and supported by the IMF programme.

Gross International Reserves
Reserves rose substantially from USD 4.8 billion in 2016 to nearly USD 9 billion by December 2024, as shown in the Bank of Ghana Summary Statistics (2017–Sept 2025). This improvement provided the cushion for the stability now being celebrated.

Inflation Rate
Inflation fell notably from 31.9% in 2022 to 22.9% by December 2024 (Budget Table 2, Page 7 of the 2026 Budget Statement). The disinflation path was clearly set before the current budget year.

Taken together, these indicators confirm that Ghana’s macroeconomic recovery did not begin in 2025 but was already taking shape due to earlier reforms. As the IMF noted in its January 2024 press release, “Ghana is making important inroads to stabilize its economy, and continued program implementation beckons a brighter future.”

Furthermore, IPPA notes that the much-touted “Resetting for growth, jobs and economic transformation” failed to live up to expectations. Key macroeconomic targets for the 2026 fiscal year signal modest ambition and are less likely to substantially transform the economy to generate the needed jobs.

Macroeconomic Outlook for 2026

• Overall real GDP growth is projected at 4.8%, lower than the 6.3% achieved by June 2025.
• Non-oil real GDP growth is projected at 4.9%, falling short of the 2025 target of 5.3%.
• End-year inflation is projected at 8.0%, unchanged from 2025.
• Gross international reserves are expected to remain at not less than three months of import cover, same as 2025.
• Total revenue and grants are projected to rise modestly from 16.0% of GDP in 2025 to 16.8% in 2026.
• Primary expenditure is projected to rise from 14.2% of GDP in 2025 to 15.3% in 2026.
• The overall fiscal deficit on a commitment basis is projected to narrow slightly from 1.8% of GDP in 2025 to 2.2% in 2026, while the cash-basis deficit is projected at 4.0% of GDP.

2026 Expenditure Highlights
Total expenditure on a commitment basis for 2026 is programmed at GH¢302.5 billion, representing 18.9% of GDP, and an increase of 20.1% over the 2025 projection of GH¢251.7 billion (17.8% of GDP). Primary expenditure, which excludes interest payments, is projected at GH¢244.7 billion (15.3% of GDP).

Compensation of employees, covering wages, salaries, pensions, gratuities, and social security contributions, is projected at GH¢90.8 billion (5.7% of GDP). Capital expenditure (CAPEX) is projected at GH¢57.5 billion (3.6% of GDP), of which GH¢45.5 billion (2.8% of GDP) represents domestically financed CAPEX, comprising GH¢15.5 billion for MDAs and GH¢30.0 billion for the Big Push Infrastructure Programme. Foreign-financed CAPEX, mainly project loans and grants, is projected at GH¢12.0 billion (0.8% of GDP).

Challenges with Budget Design and Fiscal Credibility
IPPA notes significant challenges with budget design and fiscal credibility. There is a lack of a coherent implementation framework for key policy initiatives, along with evident weaknesses in budget credibility and capital expenditure execution, suggesting that even existing commitments are at risk of being underfunded or unfulfilled.

Lack of Credible Implementation Plan for the 24-Hour Economy Policy
IPPA is concerned that the flagship 24-Hour Economy Policy, touted as transformative for job creation, lacks the detail and seriousness required for effective execution. According to the National Coordinator of the Policy, Mr. Goosie Tanoh, full implementation requires approximately USD 4 billion (GHS 48 billion at GHS 12/USD). Yet, the 2026 Budget allocates only GHS 90 million (0.18% of the requirement), suggesting the policy remains symbolic rather than substantive, lacking operational frameworks, measurable targets, timelines, institutional arrangements, or sectoral rollout strategy.

Concerns Over Budget Credibility and Capital Expenditure Execution
Budget credibility remains a major challenge. In 2025, the government committed only about 34% of allocated capital expenditure and disbursed just GHS 9 billion out of the GH¢13 billion approved for the Big Push Infrastructure Project. If these challenges persist, it raises doubts about financing ambitious 2026 programmes such as the Big Push Infrastructure Agenda, the Women’s Development Bank, and other capital-intensive initiatives. Under-delivery on capital allocations undermines public confidence and weakens the transformative potential of flagship policies.

Conclusion and Recommendations
The Institute of Public Policy & Accountability calls on the Government to:

1. Reassess the 2026 Budget to ensure it is grounded in realistic fiscal projections and operational capacity.
2. Provide a comprehensive and fully costed implementation plan for the 24-Hour Economy Policy, including financing strategies, institutional coordination, timelines, and measurable outcomes.
3. Prioritise transformative investments over symbolic allocations, particularly in sectors that can deliver sustainable jobs and productivity growth.
4. Improve budget credibility, especially in capital expenditure execution, to ensure that announced programmes translate into real development outcomes.
5. Acknowledge the continuity of reforms and sustain collaboration with independent institutions, including the IMF, to maintain macroeconomic stability.

Ghana deserves an economic policy framework that is ambitious yet credible, visionary yet grounded in evidence, and bold yet accountable. IPPA remains committed to providing independent, data-driven policy analysis to support national development.

Signed
Kwasi Nyame-Baafi, PhD
Director of Public Policy, IPPA

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