The variety of State-Owned Enterprises (SOEs) contributing dividends to Ghana’s economic system stays alarmingly low, with solely three SOEs making funds in 2024.
This was revealed by Finance Minister Dr. Cassiel Ato Forson throughout a gathering to guage the efficiency of specified entities.
Regardless of the federal government’s push for improved monetary administration and accountability, Ghana’s dividend-paying SOEs have stagnated at simply three entities, highlighting the persistent struggles throughout the sector.
Based on Dr. Forson, the State Housing Firm, Ghana Reinsurance Firm, and TDC Growth Firm had been the one SOEs that managed to pay dividends in 2024.
Collectively, they contributed simply GH¢28.7 million to the nationwide coffers.
This determine, whereas an enchancment from earlier years, stays modest given the numerous authorities investments in SOEs.
As compared, solely two SOEs—Ghana Ports and Harbours Authority (GPHA) and Ghana Reinsurance Firm—paid dividends in 2018.
By 2019, the quantity elevated to a few, with GPHA, Ghana Re, and TDC contributing a complete of GH¢14.4 million.
Nevertheless, by 2024, State Housing Firm changed GPHA, sustaining the variety of dividend-paying SOEs at three.
The shortage of dividend funds displays the broader monetary instability amongst SOEs, lots of that are working at a loss.
Main establishments such because the Electrical energy Firm of Ghana (ECG), Ghana Cocoa Board (COCOBOD), and Ghana Grid Firm (GRIDCo) have been posting huge losses, limiting their capacity to contribute to the federal government’s income.
Dr. Forson emphasised that the monetary struggles of SOEs pose a significant fiscal threat to the economic system and referred to as for pressing reforms to make sure these entities develop into financially sustainable.
To deal with these challenges, the Finance Minister outlined key measures, together with improved company governance to make sure SOEs function effectively and profitably, enhanced monetary self-discipline to scale back waste and mismanagement and strict enforcement of reporting necessities beneath the Public Monetary Administration (PFM) Act, 2016.
Dr. Forson harassed that the federal government will implement compliance with monetary reporting obligations and impose sanctions on SOEs that fail to satisfy transparency and accountability requirements.
With solely three out of dozens of SOEs managing to pay dividends, there may be rising concern over the viability and long-term sustainability of those state-run enterprises.
The federal government now faces growing stress to implement efficient reforms that may drive profitability and enhance SOE contributions to nationwide improvement.
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