Ghanaians should brace themselves for a possible return to the dreaded days of erratic power supply, widely known as dumsor, if the implementation of the government’s Energy Sector Recovery Program continues to drag.
This is the warning of the International Monetary Fund (IMF) following the fifth review of the country’s bailout programme.
The Fund fears that Ghana’s hard-won economic recovery could be thrown off balance if the needed reforms in the energy sector are not fast-tracked.
In its latest Country Report, the IMF paints a picture of the risks facing the country. While Ghana remains exposed to global shocks such as rising regional insecurity, terrorism, volatile commodity prices, and shifting trade policies, the Fund is clear that domestic policy delays could be just as damaging.
One critical risk is the delay in implementing the Energy Sector Recovery Programme (ESRP), a plan designed to fix long-standing financial and operational problems in the power sector.
According to the IMF’s report, delays in implementing the programme could force the government to spend more public funds to keep the sector afloat. This extra burden would strain the budget at a time when Ghana is trying to stabilize its finances and manage debt.
More worrying for households and businesses is the practical consequence of the delay, which the Fund names as electricity and fuel supply disruptions.
This means there is the risk of power cuts returning, higher fuel costs, and businesses once again running on generators. Small shops, factories, and all businesses that run on or depend on electricity are likely to be plunged into higher costs, lost income, and job losses.
“Delays in implementing the Energy Sector Recovery Programme (ESRP) would require additional budgetary resources and lead to electricity and fuel supply disruptions,” the IMF cautioned in its report.
The IMF warns that these domestic slippages could also undermine broader economic stability. If the energy sector remains unstable, it complicates Ghana’s debt recovery efforts and makes negotiations with external creditors and development partners more difficult, potentially slowing inflows of much-needed support.
The report further added, “Ghana is vulnerable to an intensification of regional conflicts, terrorism, and geoeconomic fragmentation, commodity price volatility, and trade policy and investment shocks. Domestic policy slippages could undermine macroeconomic stability and debt progress, complicating discussions with Ghana’s external creditors and development partners.”
To avoid returning to the dreaded days of dumsor, fixing the energy sector challenges in haste is no longer optional.
The Fund cautions that without swift and consistent implementation of the Energy Sector Recovery Programme, Ghana risks sliding back into power shortages that would hurt ordinary citizens and stall the fragile economic recovery.
