As of December 2020, government had injected ¢21.5 billion into State Owned Enterprises (SOEs), the 2020 State Ownership Report has revealed.

These included government subvention of ¢1.476 billion, on-lent loans of ¢14.73 billion, an outstanding stock of government-backed guarantees of ¢2.383 billion, contingent liabilities of ¢138.99 million ($24.13 million) from ongoing Public-Private Partnership (PPP) projects. The remaining component was from government support and bail-outs to some specified entities.

According to the report, an amount of ¢797.4 million was budgeted as government subventions to eight Subvented Agencies that provide specific public service obligations, to enable them meet identifiable expenditures including staff costs and occasionally capital expenditure and goods and services.

This represents a decrease of 142.15% and 101.55% over the budgeted amounts of 2019 (¢329.3 million) and 2018 (¢395.64 million), respectively.

Meanwhile, government released¢1.426 billion in 2020 to the SOEs, representing an increase of 414.62%, from ¢277.24 million in 2019.

The Ghana Highway Authority received 94.31% (¢1.345 billion) of total releases in 2020. The Ghana Highways Authority and the Ghana Irrigation Development Authority (GIDA) were the only entities to receive allocations from both Government of Ghana and Annual Budget Funding Amount (ABFA.)

Six entities including Ghana Broadcasting Corporation, Ghana Meteorological Agency, Ghana News Agency, Community Water Sanitation Agency (CWSA), Grains and Legumes Development Board and Irrigation Company of Upper Region received allocations from the government for payment of salaries.

On-lent loans and guarantees

According to the 2020 Annual Public Debt Report issued by the Ministry of Finance, the stock of recoverable loans as at the end of December 2020 was ¢14.738 billion.

This consisted of Export Credit Guarantee Department facilities and on-lent facilities to SOEs. Out of this, ¢206.7 million were repayment arrears mainly from on-lent loans to SOEs.

The report also indicates that recovery of ¢43.3 million was made on the on-lent portfolio in 2020.

As of the end of 2020, the outstanding stock of government-backed guarantees was ¢2.383 billion, which is equivalent to $415.4 million. These guarantees are typically granted by government to enable specified entities raise credit at lower costs.

Contingent Liabilities from Public-Private Partnerships

In 2020, there were contingent liabilities arising from Public Private Partnerships (PPPs) by two state enterprises including the National Identification Project and the Teshie Nungua Desalination Project.

The projects were being implemented by the National Identification Authority (NIA) and Ghana Water Company Limited (GWCL), respectively.

Government Support

Government support to state enterprises in 2020 was to the tune of ¢1.168 billion, $241.80 million and €15 million respectively.

This was based on requests received from 10 specified entities. The seven entities requested for a “No Objection”; two for an on-lending facility; one for government guarantee and one other for government support.

In line with laid-down procedure, a Credit Risk Assessment was conducted on each entity to assess its fiscal risk to government.

The report however noted that some State Owned Enterprises are potential source of fiscal risk to the national budget.