The country remains highly vulnerable to global shocks due to the oil-driven economic growth and debt accumulation over the past decade, a new World Bank report on Ghana’s public finance review has established. 

The report said the country's economic growth over the past decade had been driven by oil production and debt accumulation, making the nation highly vulnerable to global shocks.

Consequently, the report said that in spite of decisive steps to stabilise the economy since 2022, the country needed to accompany fiscal consolidation with structural reforms to address the root causes of the crisis.

“This includes implementing measures to improve expenditure controls, enhance revenue collection and promote more efficient public spending,” the report, titled "Building the foundations for a resilient and equitable fiscal policy," said.

The Ghana Public Finance Review Report, which was launched in Accra yesterday by the World Bank Country Director for Ghana, Liberia and Sierra Leone, Robert Taliercio, said Ghana needed to persist in its ambitious fiscal consolidation efforts by ensuring that adjustments were both fair and sustainable.

"It is crucial to protect pro-poor and pro-growth investment while enhancing domestic revenue mobilisation. Additionally, Ghana must address the increasing fiscal liabilities stemming from the energy and cocoa sectors," he said.

The World Bank report further showed that the country's gross domestic product (GDP) growth of 6.8 per cent annually from 2008 to 2019 was largely fuelled by the oil sector.

However, the growth had come at a cost, with the country's debt accumulation reaching alarming levels.

The report also highlights that the country's recent debt crisis was fuelled by a combination of factors, including weak expenditure controls, inefficient public spending, underperforming revenue collection and costly borrowing.

These underlying issues have left the country exposed to external shocks, threatening the stability of its economy.