As Ghana prepares for the inauguration of President-elect John Dramani Mahama on January 7, 2025, the nation faces a myriad of challenges that could shape his administration's legacy. Mahama's recent victory in the December 7, 2024 elections has been met with both optimism and skepticism, particularly regarding the economy, corruption, and the illegal mining crisis known as galamsey. He openly acknowledged the severity of the economic crisis during a thanksgiving service on December 15, 2024, stating, "Our country is still in a very severe economic crisis" and emphasizing the need for strategic planning and faith in the recovery process [d0aee463].
The economic landscape that Mahama inherits is daunting, with over USD 50 billion in public debt and a situation described as 'bankrupt' due to high inflation and low revenue generation. The Electricity Company of Ghana (ECG) is losing about 25% of its potential revenue, translating to approximately $418.2 million annually, primarily due to power theft. The energy sector is further burdened by a staggering $2.5 billion debt, which poses a risk of power outages that could destabilize the economy even more [af9f7fb].
Inflation, which peaked at 54.1% in December 2022, has shown some signs of easing but rose again to 23% in November 2024. The cedi has depreciated over 60% against the dollar in the past three years, adding to the financial strain on households and businesses [993af515]. Mahama's administration will need to address these pressing economic issues while navigating the political landscape that contributed to his party's electoral success.
Corruption and the galamsey crisis remain significant challenges. The previous administration faced criticism for its handling of illegal mining activities, which have caused environmental degradation and loss of revenue. Mahama's leadership style will be crucial in addressing these issues, and he has been urged to avoid past mistakes and implement necessary reforms [9f484828]. In a recent address on January 12, 2025, Mahama pledged to intensify the fight against corruption, emphasizing the need for public officials to adhere to high ethical standards. He described corruption as a serious threat to society's foundation and assured Ghanaians of his commitment to serve all citizens regardless of political, ethnic, or religious backgrounds [403325fb].
On January 19, 2025, Mahama visited the Manhyia Palace to seek the support of Asantehene Otumfuo Osei Tutu II in tackling Ghana's economic challenges. He highlighted unprecedented economic issues including high inflation, macroeconomic instability, a depreciating currency, and a looming debt default. Mahama praised the Asantehene's past support during his presidency from 2013 to 2017 and committed to equitable development in the Ashanti Region, acknowledging its contribution to his 2024 electoral victory. The Asantehene, through Dasebre Osei Bonsu II, urged Mahama to fulfill promises made to the Ashanti Kingdom [5e3a2b37].
In his address, Mahama expressed faith in Ghana's potential for recovery, stating, "God’s favour is still on our dear country Ghana." He hinted at appointing Cassiel Ato Forson as Finance Minister, focusing on experienced leadership in economic management [d0aee463]. The National Democratic Congress (NDC), under Mahama's leadership, capitalized on the ruling party's perceived economic mismanagement during the elections, with key issues such as illegal mining and the unpopular E-Levy tax dominating the campaign narrative [43476c85].
Mahama's previous tenure from 2012 to 2016 saw a significant increase in the debt-to-GDP ratio, which rose from 32% to 73%. Although the current Akufo-Addo administration managed to reduce the fiscal deficit, the debt-to-GDP ratio continued to climb, raising concerns about long-term sustainability [993af515]. The Domestic Debt Exchange Programme launched in 2022 faced backlash, highlighting the challenges of managing public debt in a politically charged environment.
As Mahama prepares to take office, he has emphasized the need for constitutional changes to allow for longer presidential terms, which could provide stability for future administrations. A national forum for long-term economic development has been suggested, focusing on reducing reliance on foreign corporations for natural resource revenue and enhancing local accountability [9f484828]. With 29.5% of Ghanaians living in extreme poverty, the need for affordable and reliable energy is more critical than ever. Current electricity bills often exceed rent for lower-income Ghanaians, making it imperative for the new government to incentivize urban solar adoption and harness the country's solar energy potential [af9f7fb].
Akufo-Addo congratulated Mahama on December 9, 2024, and committed to a smooth power transition. He invited Mahama to Jubilee House on December 11, 2024, to begin the transition process [43476c85]. In the broader context, Ghana's economic recovery efforts are ongoing, with the previous administration reporting a growth rate of 5.8% in the first half of 2024, attributed to fiscal discipline and successful debt restructuring. However, the new government will need to build on this foundation while addressing the immediate concerns of debt, inflation, and energy supply to ensure a stable economic future for the country [7b94ab34].