President John Dramani Mahama has revealed that Ghana’s Sinking Fund holds a balance of only $64,000 and GHS143,000, contradicting claims by the previous Akufo-Addo administration that it left substantial reserves for debt repayment. Addressing Parliament in Accra on Thursday, February 27, 2025, during his first State of the Nation Address (SONA) of his second term, Mahama exposed the dire financial state of the country, warning that Ghana faces an uphill battle in stabilizing its economy.
“There have been claims that buffers were left for ongoing debt repayments in 2025. The Sinking Fund shows a balance of only $64,000 in the dollar account and GHS143,000 in the Cedi account,” Mahama disclosed.
The revelation sparked concerns over the country’s ability to meet its debt obligations, as the Sinking Fund was originally established to help manage Ghana’s growing debt burden by setting aside money for repayment. The stark reality of its near-empty reserves underscores the challenges ahead for the Mahama administration as it seeks to restore fiscal discipline.
Mahama further highlighted the mounting debt crisis and its implications, cautioning that Ghana’s economic situation would require significant sacrifices and bold policy decisions to reverse the damage.
“The repercussions of the accumulation and the economic mismanagement will require extensive work and sacrifices to repair,” he stated.
According to the president, Ghana’s debt servicing over the next four years will amount to GHS280 billion, comprising GHS150 billion for domestic debt and GHS130 billion for external debt servicing.
“In the next four years, our debt servicing will amount to GHS280 billion and comprises GHS150 billion for domestic debt and GHS130 billion in external debt servicing,” Mahama emphasized.
He warned that the scale of the debt crisis has placed enormous pressure on government revenue, limiting the country’s ability to invest in essential sectors such as healthcare, education, and infrastructure. With debt repayments consuming a significant portion of national revenue, Mahama stressed the urgent need for strategic financial management and debt restructuring to ease the burden.
Economists and financial analysts have echoed similar concerns, noting that Ghana’s rising debt-to-GDP ratio has made borrowing increasingly unsustainable. Many have called for reforms to improve domestic revenue generation and reduce reliance on external borrowing. Mahama reaffirmed his administration’s commitment to implementing measures that will ensure fiscal discipline and long-term economic stability.
“We must realign our priorities, cut unnecessary expenditures, and focus on generating revenue internally to build a more resilient economy,” he stated.
Beyond the debt crisis, Mahama underscored the broader economic challenges Ghana faces, including inflationary pressures, currency depreciation, and dwindling investor confidence. The Ghanaian Cedi has seen significant fluctuations in recent years, further worsening the financial struggles of businesses and households. Rising inflation has eroded the purchasing power of citizens, making basic goods and services increasingly expensive.
“The cost of living is skyrocketing, businesses are struggling, and ordinary Ghanaians are bearing the brunt of these economic hardships,” Mahama noted.
The president also criticized the previous administration’s economic policies, arguing that reckless borrowing and fiscal mismanagement had exacerbated the current crisis. He insisted that transparency and accountability would be central to his government’s approach in tackling the economic challenges ahead.
“It is imperative that we uphold fiscal responsibility, strengthen oversight mechanisms, and ensure that public funds are utilized efficiently for the benefit of all Ghanaians,” he asserted.
Mahama acknowledged the concerns of the private sector, which has been significantly affected by the economic downturn. Businesses have struggled with high interest rates, erratic power supply, and an unfavorable tax regime that has stifled growth and innovation. The manufacturing sector, in particular, has faced declining productivity due to high operational costs.
“Our private sector must be empowered to thrive. We cannot grow our economy if businesses continue to suffer under the weight of excessive taxation and economic instability,” Mahama emphasized.
He also pledged to introduce policies aimed at boosting local industries, increasing job opportunities, and improving access to credit for small and medium-sized enterprises (SMEs).
Another pressing issue Mahama addressed was the impact of the debt crisis on social services. He lamented the state of the healthcare system, where hospitals are struggling with inadequate medical supplies and a lack of funding for critical infrastructure projects. Educational institutions have also faced financial constraints, affecting the quality of learning and access to resources for students.
“Our hospitals and schools are underfunded, our roads remain in deplorable conditions, and essential services are being compromised due to poor financial management,” Mahama stated.
He called for collective action in addressing these challenges, urging lawmakers and policymakers to put national interests above partisan politics. The president stressed that rebuilding Ghana’s economy would require unity, discipline, and a commitment to long-term planning.
“We must move beyond political rhetoric and focus on practical solutions that will ensure sustainable economic growth,” he said.
Despite the bleak outlook, Mahama remained optimistic about Ghana’s ability to recover from its economic difficulties. He outlined a roadmap for economic revitalization, including enhanced revenue mobilization strategies, investment in critical sectors, and prudent financial management practices.
“Our economic recovery plan is centered on restoring investor confidence, promoting industrialization, and ensuring that every Ghanaian benefits from economic growth,” he explained.
Mahama also reiterated his administration’s commitment to engaging international financial institutions and development partners to secure favorable debt restructuring agreements. He emphasized the need for transparency in all government dealings, assuring Ghanaians that his administration would be accountable to the people.
“The trust of the people is paramount. We will work tirelessly to restore that trust by being transparent, honest, and proactive in our governance,” he affirmed.
The president’s speech resonated with many Ghanaians who have been grappling with economic hardship. Citizens have expressed concerns over rising unemployment rates, declining income levels, and the overall state of the economy. Many are hopeful that Mahama’s administration will implement the necessary reforms to bring about meaningful change.
Mahama’s revelations about the Sinking Fund and Ghana’s debt obligations have intensified discussions about the country’s financial future. His call for bold leadership, fiscal responsibility, and collective action underscores the urgency of the economic challenges at hand.
As his administration embarks on the task of stabilizing the economy, all eyes will be on the policies and measures implemented in the coming months. Ghanaians are looking for concrete actions that will alleviate economic hardship and set the nation on a path to prosperity.
Mahama’s message was clear: the road to recovery will not be easy, but with prudent financial management, national unity, and a commitment to accountability, Ghana can rebuild and emerge stronger from its current economic difficulties.
