World Bank urges Ghana to adopt pro-poor fiscal adjustments

The World Bank has advised the Ghanaian government to implement fiscal policies that promote economic growth while safeguarding the poor and vulnerable.

Speaking at the launch of the Ghana Public Finance Review Report on Wednesday, the World Bank Country Director for Ghana, Liberia, and Sierra Leone, Mr Robert Taliercio, stressed the need for fiscal adjustments that are both fair and efficient. He highlighted the importance of protecting pro-poor and pro-growth investments while enhancing domestic revenue mobilization.

“Ghana must also address the increasing fiscal liabilities in the energy and cocoa sectors,” Taliercio noted, as the government continues efforts to stabilize the economy following the 2022 economic crisis through fiscal consolidation and debt restructuring.

The report, titled “Building the Foundations for a Resilient and Equitable Fiscal Policy”, examines key aspects of Ghana’s public finance, including domestic revenue mobilization, public expenditure efficiency, and public financial management.

ADVERTISEMENT

Sharing the report’s findings, Mr. David Elmaleh, a Senior Economist at the World Bank, attributed Ghana’s 2022 economic crisis to weak budgetary institutions, high fiscal liabilities, and inadequate revenue collection. He pointed out that excessive tax exemptions had resulted in a revenue loss equivalent to 3.9% of GDP, while high government spending—especially during election years—further strained public finances.

Elmaleh also highlighted inefficiencies in public spending, particularly in education and health. He noted that funding shortfalls for the National Health Insurance Scheme (NHIS) were undermining healthcare progress, as the scheme no longer receives its full levy allocation due to capping laws.

Co-author of the report, Madam Tamoya Christie, outlined medium-term policy recommendations, urging Ghana to strengthen fiscal discipline through effective spending controls, improved oversight of contingent liabilities, and broadening the tax base to support development goals. She also emphasized the need for investment in infrastructure and technological innovation to drive economic transformation and climate resilience.

Dr Alex Amankwah-Poku, a public financial management practitioner speaking on behalf of the Finance Minister, welcomed the report’s findings, stating that they would guide the government in developing long-term policies for a more resilient economy.