The Ofoase Ayirebi MP, Kojo Oppong Nkrumah, has called on government to prioritise Public-Private Partnerships (PPPs) as a sustainable means of financing Ghana’s growing infrastructure deficit.
Addressing Parliament on Tuesday, February 25, 2025. the former Minister for Works and Housing and Information under the erstwhile Akufo-Addo administration argued that PPPs offer a viable alternative to traditional funding sources, which have become increasingly difficult to mobilize in the country.
“Ghana, in the last decade, has faced a critical infrastructure and public service deficit heightened by fiscal constraints, rising debt levels, and limited access to international capital markets.
The demand for road investments, energy, healthcare, water, and education far exceeds the government’s financial capacity to deliver at any point in time,” he stated.
Mr Oppong Nkrumah explained that while most administrations have resorted to cutting government expenditure in response to these challenges, such an approach risks slowing economic growth and limiting job creation noting that many countries around the world are increasingly turning to PPPs to bridge the infrastructure financing gap, allowing private sector actors to assume significant responsibility for financing and managing public projects.
“By leveraging private sector capital, technical expertise, and innovation, PPPs can deliver essential projects more effectively and efficiently while reducing the financial burden on the government,” he said.
Challenges hindering PPPs in Ghana
Despite the passage of the Public-Private Partnership Act (Act 1039) in 2020, Mr Oppong Nkrumah observed that Ghana’s PPP ecosystem remains underdeveloped, with only a few projects successfully executed under the model.
He cited parts of the Tema Motorway expansion and the Bonkra Inland Port project as some of the limited cases where PPPs have been utilized.
According to him, several factors continue to hinder the widespread adoption of PPPs in Ghana.
“First, there’s a low level of awareness and preference for PPPs within both the public and private sectors.
“Many project promoters and government agencies still prefer outright contracts where the private sector delivers and the government pays, rather than structuring projects as PPPs,” he explained.
He further pointed to limited capacity within both the public and private sectors for structuring, modelling, and negotiating PPP transactions, noting that even when there is an appetite for PPP arrangements, institutions often lack the technical know-how to execute them effectively.
Additionally, he lamented the bureaucratic bottlenecks embedded in the current legal framework, which slow down the negotiation and execution of PPP projects which need urgent addressing.
“Anecdotal evidence suggests that in some cases, it takes close to a year to put one project together,” he revealed.
He also highlighted the high financial risks associated with PPP projects, which are further compounded by national macroeconomic challenges such as inflation and exchange rate depreciation stating that “these discourage a lot of private sector players from engaging in long-term PPP investments.”
Recommendations for the way forward
To address these challenges, Mr Oppong Nkrumah proposed a series of recommendations to help mainstream PPPs in Ghana’s infrastructure and public service delivery.
“First, we need to improve the level of awareness and acceptability of PPPs. It’s important for increased public and stakeholder engagement to make PPPs a more common feature in infrastructure and service delivery,” he urged.
He further called for increased investment in specialized training for government officials in areas such as negotiation, risk assessment, and financial structuring.
“Consulting groups, including legal and accounting firms, as well as project management experts, also need to deepen their expertise in modelling and structuring PPPs,” he added.
To encourage private sector participation, the MP recommended that the government introduce credit enhancement mechanisms, such as government-backed guarantees, to mitigate investment risks.
Citing his experience as Minister for Works and Housing, he noted that efforts had been made to de-risk housing PPPs by providing incentives such as access to land.
“The PPP Act itself, though new, may require some immediate amendment to certain sections and enforcement of others,” he suggested.
He specifically called for a revision of Section 77 of the Act to streamline project implementation and urged the government to expedite the passage of regulations to clarify grey areas in the law.
Finally, Mr Oppong Nkrumah proposed that the government package a pipeline of bankable PPP projects and embark on regular investment roadshows to attract potential partners.
“This will fast-track the rollout of PPP projects in the country,” he emphasised.
This, the Ofoase Ayirebi legislator reiterated that PPPs present a strategic solution to Ghana’s infrastructure and public service challenges urging government to pay attention to the PPP option and mainstream it in delivering infrastructure and services for the benefit of the Ghanaian people.
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