Accra: The government's economic growth and revenue projections contained in the 2026 Mid-Year Budget Review and Economic Policy are unrealistic and require a review, the Institute of Fiscal Studies (IFS) has said. The Institute argued that the projections did not adequately reflect the stronger-than-expected performance of the economy, particularly after Ghana recorded real GDP growth of more than five per cent in 2025.
According to Ghana Web, the Executive Director of the IFS, Dr. Said Boakye, emphasized the need for the government to ground its macroeconomic assumptions in available economic evidence to enhance the credibility of the national budget. Presenting the Institute's assessment of the 2026 Mid-Year Budget Review, Dr. Boakye highlighted discrepancies between the government's GDP growth and revenue mobilisation projections and the current economic realities.
Dr. Boakye explained that a stronger economic performance should have led to more realistic fiscal targets, instead of conservative assumptions that might weaken budget planning and execution. He noted that the nominal GDP, real GDP growth rate, and total revenue and grants to GDP ratio targets for the 2026 budget period appeared unrealistic.
The Institute expressed concern over weak forecasting undermining confidence in the budget and affecting the government's ability to plan expenditure effectively. Dr. Boakye suggested that GDP projections be updated when new data indicate a significantly different outlook than previously anticipated. The IFS also called for independent reviews of government forecasts before their inclusion in budget statements to improve reliability and transparency.
Despite signs of economic recovery, Dr. Boakye pointed out challenges in revenue mobilisation, especially from the rapidly expanding small-scale gold mining sector. Ghana's gold exports more than doubled in 2025, increasing by 103.3 per cent, with small-scale miners contributing $10.8 billion, or 51.5 per cent of total gold exports. However, the growth in gold exports did not translate into corresponding fiscal benefits, as mineral royalties only increased by 21 per cent.
Dr. Boakye cited data from the Minerals Income Investment Fund, which indicated that royalties collected from gold production in 2025 came entirely from the large-scale mining sector. He urged the state to ensure it receives a fair share of the benefits from mineral resource extraction and recommended developing a strategy to capture revenue from small-scale mining.
While acknowledging positive economic developments, such as declining inflation and interest rates, the IFS raised concerns about weak budget execution in the first half of 2026. Total expenditure fell short by GHS35.6 billion, with capital expenditure recording a GHS14.35 billion shortfall. The Institute warned that delays in implementing planned spending could hinder economic activity and growth.
Dr. Boakye urged the government to align expenditure decisions with approved budget plans, improve fiscal data reliability, and ensure the gold sector contributes meaningfully to national development.