Ghana must legislate and enforce debt ceiling – Dr Ishmael Yamson
Dr Ishmael Yamson, Board Chairman of MTN Ghana, has warned that Ghana cannot rely on political goodwill alone to manage its public finances, arguing that the country’s debt ceiling must be firmly legislated and strictly enforced.
He was speaking at the University of Ghana’s 77th Annual New Year School and Conference on January 6, 2025.
In his address, Dr Yamson stressed the need for legal backing and enforcement, saying: “We must legislate a statutory debt ceiling and enforce it. And repeat, enforce it.”
His comments come eight months after Parliament passed the Public Financial Management (Amendment) Act, 2025, which sets a debt-to-GDP cap of 45 per cent by 2034. Dr Yamson, however, said legislation on its own would not be enough to prevent future fiscal excesses.
“We cannot rely on the goodwill of politicians to spend wisely,” he said in remarks delivered in the presence of President John Dramani Mahama. “We must legislate a statutory debt ceiling and enforce it.”
Dr Yamson said Ghana’s economic history showed repeated failures to sustain fiscal discipline, noting that the country has turned to the International Monetary Fund 17 times since independence, an average of one programme every four years.
“Every government since independence has been accused of economic mismanagement when leaving office,” he said. “We have never managed our economy prudently over a long period.”
He argued that the repeated cycle of building confidence and then eroding it has kept Ghana trapped in poverty, adding that the country needs at least ten years of steady and disciplined economic performance to earn lasting investor trust.
Dr Yamson also called for an independent fiscal council with the authority to restrain government spending before damage is done. “We need biting powers, not advisory powers,” he said.
The Public Financial Management (Amendment) Act, passed in April 2025, created a Fiscal Council to independently assess fiscal policy, though its role is largely advisory, focusing on analysis and recommendations rather than direct enforcement.
Under the law, Parliament may pass a vote of censure against the Minister of Finance if fiscal rules are breached by more than one percentage point in two consecutive years. Dr Yamson said such measures could fall short without strict application.
He described election-year spending as the most immediate threat to Ghana’s economic recovery. “We are entering an election season soon,” he said. “The history of the Fourth Republic shows that fiscal discipline often gives way to political convenience during elections.”
Dr Yamson said investor confidence, capital retention and long-term planning depend on predictable fiscal management, an area Ghana has struggled with under successive governments.
The amended law, which repealed the Fiscal Responsibility Act of 2018, introduced a primary balance rule requiring an annual surplus of at least 1.5 per cent of GDP. It also tightened sanctions for fiscal breaches and requires parliamentary approval before fiscal rules can be suspended.
He said Ghana’s fiscal challenges are rooted as much in politics as in technical policy design. “We cannot borrow our way to prosperity, and no country has done so,” Dr Yamson said. “The cycle of boom, bust and IMF programmes must end with our generation.”
While acknowledging progress at the macroeconomic level, he said deeper structural problems persist, citing corruption, heavy import dependence and rising public debt, including energy sector liabilities, as ongoing threats to fiscal space.
Dr Yamson ended his address by challenging Ghanaians to consider how history would judge this generation when the country marks 100 years of independence in 2057.
“Will history say we chose the easy path when we stood at the crossroads in 2025, borrowing and consuming while leaving debt behind,” he asked, “or will it say we were the generation that broke with impunity and changed the structure of our economy?”
