Financial Institutions and Private Equity Investors seeking desired changes from the Mid-Year Budget Review as proposed by the Minister of Finance
In a significant move, Ghana's 2025 Mid-Year Budget Review, presented on July 24th, focuses on fostering economic growth and attracting investment. The review aims to establish macroeconomic stability, promote regulatory reforms for domestic capital allocation, and encourage domestic capital investment for enterprise growth.
The government's commitment to macroeconomic stability is evident in the significant progress towards fiscal discipline. By June 2025, a primary surplus of 1.1% of GDP was achieved, surpassing the target of 0.4%. Inflation has also dropped substantially from 23.8% at the end of 2024 to 13.7% by mid-2025. While interest payments have seen a slight increase due to additional bilateral creditor disbursements, the overall interest payments have been revised downwards due to prudent debt management. The government has also emphasised the importance of the Ghana cedi as a symbol of sovereignty and economic independence, with a push to build public confidence in it.
Regulatory reforms for domestic capital allocation are expected to be a focus moving forward. The positive fiscal indicators and improved tax revenue performance suggest groundwork towards better resource mobilisation and financial sector stability. The review's theme, "Resetting the Economy For The Ghana We Want," implies ongoing structural reforms aimed at enhancing domestic capital flow and fiscal governance.
The budget review also underlines plans to promote domestic capital investment opportunities for enterprise growth. Measures include government payment discipline, infrastructure projects like major road developments to stimulate economic activity, and aligning fiscal policy to create an enabling environment for enterprises. The government's strategy also involves directing pension funds to SMEs and high-growth companies, enabling them to scale, expand production, and invest in human capital, providing a direct boost to job creation.
The operationalization of the Limited Partnerships (LP) Act is expected to make Ghana a more competitive jurisdiction for private equity funds. The budget is also expected to provide specific tax incentives, discounted night-time electricity tariffs, and streamlined regulatory processes for businesses adopting 24/7 operations.
The Ghana Venture Capital and Private Equity Association (GVCA) has expressed eager anticipation for the mid-year budget review. The review is expected to signal the accelerated implementation and robust enforcement of the Limited Partnerships (LP) Act, which provides a familiar and robust legal framework for private equity and venture capital fund structures.
Investors have expressed a priority area as macroeconomic stability, which they hope to see through a clear and sustained commitment to fiscal discipline and prudent monetary policy. They also emphasise the need for regulatory and policy reforms for domestic capital allocation, with a focus on accelerated implementation and robust enforcement of reforms designed to channel domestic capital into productive private sector investments.
The budget is expected to commit to improving critical infrastructure, such as reliable power, transportation networks, and digital connectivity, which directly supports industrial growth and reduces the cost of doing business. Stable macroeconomic conditions are expected to reduce uncertainty, allowing investors to confidently deploy capital over extended periods, crucial for the gestation of enterprise growth and industrial projects.
However, the budget must be careful not to crowd out private sector access to affordable financing by competing heavily for domestic capital through high-yield short-term instruments. The budget is also expected to unlock over GH¢5 billion by shifting pension funds from primarily passive, short-term government debt instruments to long-term, growth-oriented private sector investments.
In conclusion, the 2025 Mid-Year Budget Review concentrates on sustaining macroeconomic stability through strong fiscal discipline and inflation control, preparing for further regulatory reforms to enhance domestic capital efficiency, and fostering domestic capital investment for enterprise growth through improved economic management and infrastructural investment. These measures are expected to create significant job opportunities, drive industrialization, and expand Ghana's tax base, making Ghana an attractive destination for local and international investors.
Technology will play a crucial role in facilitating regulatory reforms for domestic capital allocation, as digital platforms can streamline processes and reduce bureaucratic delays. (Regulatory reforms, technology)
Personal-finance management tools can help entrepreneurs make informed decisions about their business investments, ensuring they allocate resources effectively and achieve sustainable growth. (Business, personal-finance, investing)
