GH¢5.96b for ECG, GH¢3.8b for COCOBOD: Here are some SOEs operating at ‘striking’ losses

ECG’s GH¢5.96 Billion Loss: A Power Sector in Crisis

The Electricity Company of Ghana (ECG) has recorded a staggering loss of GH¢5.96 billion, further deepening concerns about the country's energy sector. Despite repeated efforts to restructure and improve efficiency, ECG continues to grapple with operational inefficiencies, power theft, and non-payment of electricity bills by both government and private consumers.

Industry experts have attributed ECG’s financial struggles to a combination of poor revenue collection, high operational costs, and debt accumulation. The company’s inability to recover owed funds from major consumers, including state institutions, has further worsened its financial position.

To address this issue, the government has been exploring privatization and Public-Private Partnerships (PPPs) as potential solutions. However, these proposals have been met with resistance from stakeholders who fear job losses and higher electricity tariffs.

COCOBOD’s GH¢3.8 Billion Loss: Challenges in Ghana’s Cocoa Sector

COCOBOD, which oversees Ghana’s cocoa industry, has also recorded significant losses amounting to GH¢3.8 billion. This comes at a time when the country is facing declining cocoa yields, rising production costs, and fluctuating global cocoa prices.

According to industry analysts, COCOBOD’s financial struggles stem from excessive borrowing, mismanagement, and the increasing cost of subsidizing fertilizers and pesticides for cocoa farmers. Additionally, the impact of illegal mining (galamsey) on cocoa farmlands and climate change-induced droughts have further reduced cocoa production, affecting revenue generation.

Despite these setbacks, COCOBOD remains optimistic about reviving the industry through new financing strategies, improved farmer support programs, and efforts to boost local cocoa processing to maximize value addition.

Other SOEs Facing Financial Struggles

Beyond ECG and COCOBOD, several other SOEs are also struggling financially, including:

• Ghana Water Company Limited (GWCL) – Facing high operational costs and revenue collection challenges.

• Metro Mass Transit Limited – Struggling with fleet maintenance and revenue losses.

• Tema Oil Refinery (TOR) – Battling debt accumulation and inefficiencies in petroleum refining.

These losses underscore the broader issue of financial mismanagement within Ghana’s SOEs, raising urgent questions about the viability of these state-run institutions.

The Way Forward: Reform or Privatization?

As losses continue to mount, many analysts argue that bold reforms are necessary to ensure financial sustainability. Some of the proposed solutions include:

• Strengthening Corporate Governance: Appointing competent management teams and enforcing transparency in financial operations.

• Privatization and PPPs: Exploring strategic partnerships with private sector investors to improve efficiency and reduce government expenditure.

• Improving Debt Recovery: Enhancing billing and collection systems to ensure timely revenue inflows.

• Cost-cutting Measures: Reducing operational expenses through better procurement policies and improved energy conservation strategies.

Conclusion

The financial struggles of ECG, COCOBOD, and other SOEs highlight the urgent need for government intervention and structural reforms. Without decisive action, these losses will continue to strain Ghana’s economy and limit the country’s ability to fund essential services. The government must act swiftly to implement sustainable solutions that will restore financial stability and efficiency to these critical institutions.