ActionAid Ghana Calls for Clampdown on Illicit Financial Flows, Smarter Use of External Loans to Boost Development

ActionAid Ghana, a Civil Society Organisation focused on social justice, gender equality and poverty eradication among others has renewed its call for government to strengthen fiscal governance and enforce stricter controls on illicit financial flows (IFFs) as the country continues to seek sustainable ways to finance its development agenda.

The development-focused civil society organization is urging policymakers to prioritize the fight against corruption, citing it as critical to closing the widening fiscal gap and unlocking more domestic resources for key sectors such as healthcare, education, and infrastructure.

The call came during a civil society–government dialogue on financing for development, where stakeholders explored ways to enhance the effectiveness and sustainability of Ghana’s public financing strategies.

Leakages Undermining Progress

ActionAid Ghana says the persistent loss of public funds through illicit channels ranging from tax evasion and trade misinvoicing to public procurement abuse remains a significant threat to national development. The organization believes that plugging these financial leakages could provide government with billions in untapped resources each year.

“Government and key stakeholders should block the loopholes in illicit financial flows. We should work and support its clampdown on corruption and ensure that all that money is available for development financing. We are making a clear point that the government needs to be international with its bilateral and multilateral donors, such as the IMF and World Bank, to ensure the loans that come into Ghana are invested more productively and sustainably,” said John Nkaw, Country Director of ActionAid Ghana, during a media briefing on the sidelines of the event. He emphasized the need for coordinated efforts across state institutions to improve accountability and transparency.

Smarter, Strategic Use of External Loans

In addition to curbing IFFs, ActionAid is also advocating for a more disciplined and strategic deployment of external financing, particularly concessional loans from institutions such as the International Monetary Fund (IMF) and the World Bank.

Nkaw argued that such funds must be tied to productive and transformative projects rather than recurrent expenditure or politically motivated initiatives.

“The government needs to be intentional with its bilateral and multilateral donors to ensure the loans that come into Ghana are invested more productively and sustainably,” he noted.

Fiscal Space Through Reform

The organisation maintains that a two-pronged approach tightening financial governance while improving the targeting of donor funds could significantly expand Ghana’s fiscal space. This, it says, would reduce the country’s overreliance on debt and enable homegrown development solutions.

ActionAid Ghana is among several civil society groups advocating for reforms that prioritise long-term economic transformation, job creation, and poverty reduction, especially in the wake of Ghana’s ongoing IMF-backed economic recovery programme.

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