President-Elect Mahama Calls for Urgent Reforms in Ghana’s Energy Sector

Ghana’s current energy state is a major threat to nation’s economic stability according to Ghana’s President elect John Dramani Mahama who raised such concerns. Speaking during a courtesy visit by Canada’s High Commissioner to Ghana, Myriam Montrat in Accra, Thursday, December 19, Mr. Mahama called for urgent and comprehensive reforms to deal with the challenges vexing the sector.

According to Mr Mahama, the energy sector of Ghana is in dire straits and the need for its revitilization was stressed during the meeting. He said unless there is immediate and substantial action, the industry’s lack of stability could undermine the country’s wider economic recovery efforts.

The President-elect warned the energy sector needed immediate surgery or it could roll everything.

According to him, reforms that are geared towards achieving efficiency, sustainability and an energy supply for all Ghanaians remains his administration’s priority. Mr. ‘We will ensure that developing stakeholders, including international partners, are taken along side to discuss and implement a roadmap by which the sector’s critical needs were addressed,’ he pledged.

Mr. Mahama used the occasion to criticize the outgoing administration’s management of Ghana’s energy sector, citing especially its inability to resolve the energy sector’s enormous debt burden. He pointed out that the .5 billion energy sector debt remained ‘unresolved’ as one of the glaring issues and asked how can the government claim to be heading towards economic recovery when all these things have not been settled.

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“If the economy is turning around, you have a .5 billion debt, your bailout is only billion and .5 billion is sitting and breathing,” he said.

But the President elect termed the unsettled debt as a possible “economic ticking time bomb” that would wipe away every improvement recorded on the economy.

Mahama was also critical of the outgoing administration’s optimistic narrative about Ghana’s economic prospects, saying it was an effort to boost the image of the group before leaving office.

“That alone can crush everything that has been done,” he said of the unsustainable debt burden and the broader issues confronting the energy sector.

Priorities for Energy Sector Reform

President-elect Mahama outlined his administration’s focus on addressing key issues within the energy sector, including:

Debt Restructuring: To create a viable debt management scheme for the approximately $2.5 billion debt in the energy sector.

Sustainable Energy Supply: Stable and low energy supply measures to residential and industrial consumers.

Efficiency and Innovation: Introduction of modern energy generation and distribution technologies and practices.

Stakeholder Engagement: The ISDR works with partners (development partners, industry stakeholders and international donors) to get the resources and expertise required for reform.

“It’s a pleasure to have you here and I’m glad to welcome your vision, which is very timely for the energy sector reform that Mr Mahama and the government of Ghana has proposed,” Ms Myriam Montrat, Canada’s High Commissioner in Ghana, said welcoming Mr Mahama. She, the leading economist admitted that the sector had been pivotal in the driving of economic growth but also said that strong leadership would see Ghana surmount its current challenge.

What he says is that energy sector stability is the linchpin to the country’s economic aspirations. We want to deliver a reliable energy supply for industries, businesses and households, and unresolved debt issues can create uncertainty about investor confidence and broaden considerations for fiscal stability.

Some have said Mahama’s proposed reforms reversing the sector’s decline and acting to ensure its sustainability and growth are necessary.

The fact that President elect John Dramani Mahama’s own call for immediate reforms to Ghana’s energy sector goes some way to prove the merits in the case of handling problems that exist in the sector. Ghana’s economy must be at risk in view of debt and inefficiencies leading to the sector weighed down.

Mahama administration’s target is to lay ground work for a sustainable and reliable energy sector that is going to support Ghana’s growth, through reform both at home and international partners and innovation. Those promises will be crucial for restoring confidence and promoting long term economic growth but it will be the ability of the new government to execute on these promises that will be most important to the economy.