Major Challenges Facing Ghana’s Upcoming Election
Ghana is preparing for general elections on December 7, during which citizens will choose both a president and members of parliament. Approximately 18.8 million citizens are registered to participate in this electoral event.
The political arena in Ghana is primarily influenced by two dominant parties: the New Patriotic Party (NPP) and the National Democratic Congress (NDC). This two-party system fosters a very competitive atmosphere. Recent polls indicate that Vice President Mahamudu Bawumia and former President John Mahama are the top candidates.
Bawumia has held the position of Vice President for eight years under Nana Akufo-Addo, who is not eligible for re-election due to term limits. Conversely, Mahama served as president for four-and-a-half years starting in 2012 before losing in the 2016 elections.
Other significant challengers include prominent businessman Nana Kwame Bediako and Alan Kyerematen, a former Minister of Trade and Industry who left the NPP last year.
Celebrated as a beacon of democracy in Africa, Ghana is renowned for its electoral integrity, characterized by peaceful transfers of power since the return to multiparty democracy in 1992. Historical patterns suggest that election results will likely be announced by December 10.
According to Alex Vines, director of the Africa programme at Chatham House, the outcome of the election is still uncertain.
“This election is anticipated to be fiercely competitive. Earlier this year, I was convinced that the NDC would achieve a straightforward victory. Now, I’m unsure; a presidential runoff may take place, and while the NDC could excel in parliamentary seats, the NPP might secure the presidency. Everything remains speculative until Ghanaians cast their votes,” he remarked.
Economy at the center of debate
The upcoming elections in Ghana have brought several urgent issues to the forefront, particularly regarding economic management, as voters show increasing worry about inflation, rising unemployment, skyrocketing living costs, frequent power outages, and national debt.
Naidoo highlights that a combination of long-standing challenges, such as excessive borrowing and public expenditure—which contributed to Ghana’s 2022 default—alongside global disruptions, has intensified financial challenges, leading to dwindling international reserves, soaring inflation, and a depreciating cedi. He notes that falling commodity prices, affecting the cocoa and oil sectors, coupled with hyperinflation at the end of 2022, have left many Ghanaians feeling “exhausted.”
In May 2023, the IMF approved a 36-month extended credit facility for Ghana worth about $3 billion, effective until 2026. Recently, the IMF completed the third review of the program, allowing for an immediate disbursement of approximately $360 million.
As the program continues to undergo regular assessments, it may be adjusted based on election outcomes; however, both parties will likely need to comply with its financial constraints.
Given these limitations, political parties are striving to differentiate their platforms. Political analyst Jervin Naidoo from Oxford Economics Africa notes that Mahama’s NDC plans to boost public spending in social sectors, while Bawumia’s NPP emphasizes enhancing economic stability through lower inflation and stimulating private sector investment.
“In terms of immediate demands and economic effects, significant changes are unlikely since Ghana’s fiscal policy is governed by the IMF program,” Naidoo clarifies.
Bright Simons, a Ghanaian innovator, entrepreneur, writer, and commentator, tells African Business that the electorate’s focus on pressing issues discourages parties from making bold promises for extensive reforms.
A challenging journey ahead
The primary challenge remains inflation. Consumer prices have increased over the past three months, with a year-on-year rise of 23% in November, up from 22.1% in October, largely driven by surging prices of essential food items.
The depreciation of the cedi also represents a significant obstacle. The currency has weakened considerably against the US dollar due to economic strains stemming from the Covid-19 pandemic, further aggravated in 2022 when Ghana defaulted on a large portion of its external debt.
Since early 2020, the US dollar has appreciated nearly 180% against the Ghanaian cedi, which is currently trading around 15 to the dollar, rising from 11 in May 2023.
Tackling these issues—while working with the IMF to reform the economy and attract investments—will be a formidable task for the next government, according to Vines.
“The new administration will face a significant challenge in reforming the Ghanaian economy and drawing in new investments for sustainable growth. Politicians often make exaggerated promises while underestimating the difficult decisions that lie ahead; this pattern is frequently noticed in democratic elections. Their pledges need to be critically examined,” he concluded.