Environmental degradation and climate-related disasters could become the next major source of economic instability in Ghana if urgent action is not taken to address the growing threats, Professor Godfred Alufar Bokpin of the University of Ghana has warned.
The finance professor has consequently urged the government to access the International Monetary Fund’s (IMF) Resilience and Sustainability Facility (RSF) to strengthen the country’s capacity to address climate-related risks and mitigate their economic consequences.
According to Prof. Bokpin, Ghana’s environmental challenges, particularly coastal erosion, illegal mining and ecosystem destruction, have the potential to create economic shocks that could rival traditional fiscal and financial crises if left unchecked.
He suggested that the RSF programme could be anchored on the recently announced IMF Policy Coordination Instrument (PCI), enabling the country to pursue targeted reforms aimed at improving environmental sustainability and climate resilience.
“The next major crisis Ghana may face might not come from the traditional sources we often focus on. It could arise from coastal erosion and environmental degradation,” he said.
He stressed the need for a more credible and measurable strategy to tackle environmental issues, especially illegal mining, which continues to threaten water bodies, farmlands and forest reserves.
“We say we are fighting illegal mining, but what is required is a programme with clear indicators that can be monitored monthly, quarterly or annually to assess progress and ensure accountability,” he added.
Prof. Bokpin made the remarks while delivering a presentation on “Navigating Ghana’s Post-IMF Transitions: Historical Perspectives and Future Prospects” at the 2026 Pension Strategy Conference in Accra.
The conference, held under the theme “Renewing the Ghanaian Pension Promise: Promoting Confidence, Resilience and Sustainable Growth,” brought together policymakers, pension fund managers, economists and financial sector stakeholders to discuss emerging economic risks and investment opportunities.
The economist commended the government’s decision to adopt the Policy Coordination Instrument with the IMF, describing it as an important framework for maintaining macroeconomic discipline after the completion of the country’s current IMF-supported programme.
He argued that Ghana still requires an external policy anchor to sustain fiscal reforms, strengthen investor confidence and maintain economic stability.
“We are not yet at the stage where we can completely operate without an external policy framework. The Policy Coordination Instrument provides an important anchor for policy credibility and reform implementation,” he noted.
However, Prof. Bokpin called on the government to disclose the specific reforms and policy measures expected under the PCI arrangement to enable citizens, businesses and analysts to assess its likely impact on the economy.
Greater transparency, he said, would help build public confidence and facilitate broader stakeholder participation in the reform process.
The IMF’s Resilience and Sustainability Facility provides long-term and affordable financing to low-income and vulnerable middle-income countries undertaking reforms aimed at addressing structural challenges that could threaten future balance-of-payments stability.
The facility primarily supports climate adaptation, environmental sustainability and pandemic preparedness initiatives that have significant macroeconomic implications.
Participants at the conference noted that climate change and environmental degradation are increasingly becoming critical economic issues, with adverse effects on agriculture, infrastructure, public health and livelihoods.
The discussions also highlighted the importance of building resilient investment portfolios and strengthening long-term economic planning in the wake of recent macroeconomic challenges, including high inflation, debt restructuring and exchange rate volatility.
Industry stakeholders observed that Ghana’s pension sector is operating in a rapidly changing economic environment, making sustainability, diversification and risk management increasingly important for protecting retirement savings and ensuring long-term growth.
