Ghana's road infrastructure sector is grappling with a severe financial crisis, according to Roads and Highways Minister-designate, Kwame Governs Agbodza. Testifying before Parliament's Appointments Committee on Monday, January 20, 2025, Mr. Agbodza painted a stark picture of mounting debts and unsustainable financial practices, demanding urgent reforms.
The minister-designate revealed that the government owes contractors approximately GH₵3 billion in certified payments, with accumulated arrears reaching a staggering GH₵15 billion. This massive debt burden, coupled with accruing interest, is severely undermining the sector's financial stability and placing a significant strain on the economy.
Mr. Agbodza provided a detailed breakdown of the problem, noting that GH₵113 billion was allocated to road projects in 2018, along with an additional GH₵665 million in interest payments. He characterized the current financing model as unsustainable, highlighting the predicament of contractors who are forced to secure high-interest loans to complete projects, only to face prolonged delays in payment, further exacerbating their financial woes. "This cannot continue," he warned, emphasizing that the current system not only financially constrains contractors but also disincentivizes them.
To address this crisis, Mr. Agbodza proposed a comprehensive overhaul of the sector's financial framework. Key proposals include optimizing the overleveraged Road Fund and fostering a more collaborative approach among contractors, auditors, and government agencies to enhance efficiency and transparency in resource allocation. He stressed the importance of aligning expenditure with actual revenue, stating that overcommitting funds erodes confidence and hinders progress. He advocated for prioritizing fewer, high-impact projects over dispersing resources across numerous initiatives.
The minister-designate also acknowledged the political dimension of road project allocations, urging collaboration across party lines. "This is not an NDC or NPP issue," he remarked, emphasizing that road projects benefit all communities, and their effective management reflects a collective commitment to national development. He called for greater unity and pragmatism, suggesting a reassessment of ongoing projects to ensure more strategic resource allocation.
Mr. Agbodza reaffirmed his commitment to building a sustainable and equitable road infrastructure sector, emphasizing the need to minimize financial waste and ensure value for money for every cedi spent. The synergy between government and contractors, he stressed, is paramount in achieving this goal.
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