The Institute of Economic Affairs (IEA) has urged Government to use the gains from macroeconomic stabilisation to drive job creation, productivity and industrialisation.
The Institute of Economic Affairs (IEA) has urged Government to use the gains from macroeconomic stabilisation to drive job creation, productivity and industrialisation.
The Institute said improved economic indicators needed to translate into higher household incomes, productive investment and better livelihoods for Ghanaians.
Professor Alexander Bilson Darku, Director of Research at the IEA, made the call at the Institute’s assessment of the 2026 Mid-Year Budget Review in Accra on Wednesday.
He said Government should move towards transformational budgeting, with greater emphasis on growth-enhancing infrastructure under programmes such as the 24-hour economy, while maintaining fiscal discipline.
“Ghana’s stabilisation is done. Now is the time to turn macro stability into real economic transformation, jobs and resilience,” he said.
Prof Darku said real Gross Domestic Product (GDP) growth stood at 6.4 per cent in the first quarter of 2026, above the full-year target of 4.8 per cent.
He said inflation had fallen from 23.8 per cent in December 2024 to 5.4 per cent in December 2025, before rising marginally to 5.7 per cent by June 2026.
Prof Darku said the fiscal position had also improved, with the primary balance recording a surplus of 0.9 per cent of GDP by June, against the full-year target of 1.95 per cent.
He said gross international reserves had risen to five months of import cover, while the debt-to-GDP ratio had declined from 61.8 per cent in 2024 to 44.7 per cent in 2025 and 45 per cent by June 2026.
Prof Darku, however, raised concerns about the structure of economic growth, saying services expanded by 7.1 per cent while agriculture, a major source of employment, grew by four per cent.
He called for targeted policies to transform agriculture from subsistence production to industrial production, including increased public investment in agro-processing, extension services, climate adaptation and improved seed systems.
He also called for employment-led growth, saying economic expansion should be accompanied by decent jobs and improved household incomes.
On monetary policy, Prof Darku welcomed the reduction in the policy rate but expressed concern about the continued high lending rates charged by commercial banks.
He urged Government to introduce measures to improve the transmission of lower policy rates into affordable credit for businesses and productive sectors.
Prof Darku also called for measures to strengthen exchange-rate stability without excessive reliance on gold exports, including export diversification, import substitution, stronger foreign exchange regulation and increased Ghanaian ownership of productive assets.
He recommended reforms to the natural resource regime to increase the State’s share of resource revenues and promote local processing and value addition.
On fiscal governance,Prof Darku urged the Fiscal Council to be provided with adequate technical
capacity, operational independence and access to fiscal data, with regular reports made available to Parliament, civil society and the public.
He said Ghana had demonstrated its capacity to stabilise the economy and should now focus on sustaining the gains through structural transformation.
“The question is no longer whether Ghana can stabilise its economy. We have. The question is whether we have the courage to consolidate those gains into lasting economic transformation,” he said.
Madam Sophia Akuffo, Distinguished Fellow at the IEA and chairperson of the review, said the indicators in the assessment showed that Ghana had made progress towards macroeconomic stability, particularly in inflation, fiscal performance, interest rates, reserves and public debt.
She said stabilisation should be regarded as a beginning rather than an end, with the key fiscal challenge being to translate the gains into sustainable economic growth, decent jobs with decent remuneration, productive investment and improved livelihoods.
“The critical fiscal question then is how we translate every gain made with this stabilisation into sustainable economic growth, decent jobs with decent remuneration, productive investment and overall improved livelihoods for all Ghanaians,” she said.
Madam Akuffo said she expected the assessment to stimulate constructive questions, suggestions and public discussion on Ghana’s economic development.
