Ghana and Japan have signed an impressive $13.44 million grant agreement to improve power supply stability in the West African country and its surrounding regions.
Ghana’s Finance Minister, Cassiel Ato Baah Forson signed the agreement on behalf of Ghana, while Suzuki Momoko, Chief Representative of the Japan International Cooperation Agency (JICA) Ghana Office, signed for Japan.
During the signing ceremony in Accra on Friday, Minister Forson expressed gratitude to the Japanese government for supporting efforts to stabilize power distribution in Tamale.
He also expressed Ghana’s readiness to collaborate with JICA and Japan to implement projects that drive national development.
Speaking at the signing ceremony, Suzuki Momoko, JICA Ghana’s Chief Representative, highlighted the significance of the project, saying that it strengthens diplomatic ties between Ghana and Japan.
She said that the project, slated for completion in two years, will enhance electricity reliability for key areas such as the Tamale Central Market, Central Business District, Central Hospital, educational institutions, and nearby rural communities.
“The project will reduce both the frequency and duration of power outages in Tamale, cutting fuel costs and CO₂ emissions by minimizing generator use during outages, thereby contributing to environmental sustainability,” she added
She stated that the Northern Electricity Company Limited (NEDCo) would oversee the project’s implementation.
Momoko noted that this agreement marks Japan’s second power-related investment in Ghana, following the Power Distribution Project in Tamale and Sunyani in 2015.
The grant will fund the construction of a primary power substation to enhance electricity stability in Tamale.
The two-year project will also include building a control room, installing transformers, and connecting sub-transmission lines.
Ghana’s critical electricity sector
Earlier this year at the National Economic Dialogue (NED) 2025, Ghana’s Finance Minister, Cassiel Forson, warned that the country’s energy sector will face an imminent cumulative loss projection of over $9 billion by 2026 if reforms are not urgently implemented.
In his presentation to the forum, the finance minister stated that the sector “requires bold measures,” disclosing that in 2024 alone, the sector recorded a shortfall of $2.2 billion, despite government transfers of $2.1 billion between 2023 and 2024 to stabilise the industry.
“The energy sector in Ghana has become a ticking time bomb, costing about 2% of GDP every year. The objectives of the energy recovery program are completely off track. Fixing the sector requires radical measures,” Forson warned.
The minister also revealed that a large portion of the Electricity Company of Ghana (ECG)’s revenue is spent on non-essential expenditures.
