Role of banks as catalysts for real sector: Infrastructure and industrial financing: Strategic insights from the 2026 Budget Statement and Economic Policy

By Norman Adu BAMFO

Ghana’s 2026 Budget statement, ‘Resetting for Growth, Jobs, and Economic Transformation’, ushers in a new phase of economic transformation, moving decisively from stabilisation toward a bold, investment‑led growth agenda.

With over GH¢30 billion earmarked for the Big Push infrastructure programme, renewed emphasis on agro‑industrial value chains, and the country’s pivot toward a 24‑Hour Economy, government policy now clearly prioritises productivity, jobs, and competitiveness.

This marks a decisive shift toward large‑scale investment in infrastructure, industrialisation, and technological modernisation, underpinned by a macroeconomic environment that has been stabilised, inflation reduced to single digits, revenue performance improved, and confidence in the domestic economy rebuilt.

Yet the scale of ambition reflected in the 2026 Budget, ranging from nationwide road expansion and agriculture enclave development to logistics infrastructure, industrial parks, and social investments; cannot be carried by public finances alone.

The success of this transformational agenda depends critically on the domestic financial system, especially commercial banks and development finance institutions (DFIs). Ghanaian banks must evolve from traditional short‑term lending models into active financiers of long‑term infrastructure, industrial expansion, agribusiness value chains, and energy sector restructuring.

This article therefore explores how the 2026 Budget reshapes the financial landscape, the catalytic role expected of banks, the persistent structural constraints limiting real‑sector credit, and the strategic policy actions needed to position banks as engines of Ghana’s economic renewal.

In this new era, the banking sector is not simply an intermediary; it is a central actor in delivering Ghana’s transformation by mobilising domestic savings, structuring long‑term finance, and partnering with DFIs and the private sector to fund the next phase of national development.

The 2026 Budget – A paradigm shift toward infrastructure and industrial development

The Budget commits approximately GH¢30 billion to strategic roads, bridges, energy infrastructure, and logistics systems, forming the backbone of the Big Push Programme. These investments reflect government’s recognition that infrastructure is a productive asset, one that lifts economic efficiency, lowers transport costs, and opens new industrial and agricultural frontiers.

At the same time, the Budget intensifies industrialisation efforts through expanded agro‑processing infrastructure, livestock and oil palm mechanisation programmes, renewed support for manufacturing productivity, and the rollout of the 24‑Hour Economy to boost output capacity. This marks a transition from past cycles of stabilisation to a more structural and transformative development agenda, one requiring long‑term, patient capital.

The banking sector’s strategic intermediation role

Commercial banks and DFIs stand at the centre of this transformation. With improved macro stability, lower inflation, and a more predictable yield curve, the 2026 fiscal framework creates conditions conducive for long‑term lending.

Banks are uniquely positioned to mobilise domestic savings into long‑term capital, structure project finance for roads, bridges, renewable energy, and logistics infrastructure, and co‑finance with GIIF, DBG, and private investors under blended finance arrangements. They can design PPP financing solutions in sectors such as health, airports, digital infrastructure, and industrial estates, while supporting agriculture value chains with working capital, equipment leasing, and warehouse financing.

Equally, banks can finance industrial modernisation, including automation, energy efficiency, and expanded factory operations under the 24‑Hour Economy. Several institutions already maintain specialised desks in agribusiness, corporate banking, structured finance, and public sector lending. These must now be strengthened to meet the scale and complexity of the 2026 development strategy.

Structural constraints and risk considerations

Despite their potential, banks face persistent constraints that undermine real‑sector financing. Over the past two decades, credit allocation to agriculture and manufacturing has declined, revealing systemic weaknesses.

Liquidity and maturity mismatches make it difficult to fund long‑tenor projects, while capital adequacy strains limit balance‑sheet space for large loans. Technical limitations in project appraisal and monitoring, coupled with weak collateral enforcement, further reduce appetite for long‑term credit. Even with improved stability, lingering memories of exchange rate volatility, inflation spikes, and energy sector arrears continue to make banks risk‑averse.

These structural weaknesses reinforce short‑term lending patterns and limit credit to sectors with the highest development impact.

Why the new fiscal landscape demands bank transformation

The 2026 Budget, supported by stable inflation, a credible medium‑term debt strategy, improved energy sector liquidity, and enhanced land reforms, creates a unique opportunity for banks to take on a greater developmental role.

Government’s ongoing efforts to reduce energy sector arrears, strengthen the Cash Waterfall Mechanism, digitise land administration systems, implement value‑for‑money reforms, and promote PPPs through clear policy signalling directly lower the risk environment and improve project bankability. Banks must therefore realign their business models to support the Budget’s transformation agenda, not as a matter of compliance, but as a strategic opportunity for new revenue streams.

Policy recommendations – Strengthening bank‑led financing of the real economy

To unlock their catalytic potential, banks and policymakers must act decisively:

1. Institutionalise dedicated long‑term project finance units – Banks should establish specialised infrastructure and industrial finance desks capable of designing cash‑flow‑based lending structures, with appropriate grace periods and long‑term amortisation.
2. Scale up blended finance and risk‑sharing – Government, DBG, GIIF, and development partners should expand partial credit guarantees, political risk insurance, first‑loss facilities, and concessional lines of credit to de‑risk private capital.
3. Build technical project finance capacity – Banks must invest in upskilling staff, hiring project finance specialists, and deploying advanced risk assessment tools that reflect the complexities of long‑gestation projects.
4. Introduce regulatory and fiscal incentives – Policymakers should consider capital relief for infrastructure lending, tax incentives for long‑term loan products, lower risk weights for priority sectors, and clear standardised PPP frameworks to encourage participation.
5. Foster stronger public–private–development finance collaboration – Regular coordination among banks, DFIs, BoG, MoF, GIIF, and sector ministries will streamline project pipelines and match financing supply with sectoral demand.
6. Promote integrated value‑chain financing models – Banks should combine input financing, processing credit, logistics financing, and export support into unified, end‑to‑end credit solutions.
7. Expand SME‑responsive industrial financing – Given SMEs’ role in manufacturing and agro‑processing value chains, banks must develop innovative products such as receivables financing, equipment leasing, cluster‑based credit schemes, and digital credit scoring models.

Conclusion

The 2026 Budget signals Ghana’s transition into a new era, one defined by infrastructure expansion, industrial revival, and a productivity‑led growth model. But the transformation envisioned is only achievable through a banking sector capable of mobilising long‑term capital, structuring complex financing, and absorbing higher levels of risk in partnership with government and DFIs.

To play this catalytic role, banks must evolve beyond short‑term lending practices and embrace an expanded developmental mandate. With the right regulatory incentives, risk‑sharing mechanisms, and institutional capacity, Ghanaian banks can become powerful enablers of the country’s infrastructure build‑out, industrial diversification, and inclusive growth. Ghana stands at the threshold of an economic reset. A strategic, forward‑looking banking sector will determine how successfully the country transforms this moment into lasting prosperity.

>>>the writer is a seasoned professional in risk, finance, banking, and treasury management with over a decade of academic and industry experience. He holds an MPhil in Finance (UGBS) and a First-Class Honors BSc in Actuarial Science (KNUST), and is a Chartered Global Investment Analyst as well as an ACI-Certified Treasury Professional (Distinction). A member of ACIFMA Ghana, he also holds a Leadership and Management Certificate from IMD Business School, Switzerland. He serves as a Part-time Lecturer at the University of Ghana Graduate Business School and Instructor at the National Banking College. His dual engagement in academia and industry enables him to bridge theory and practice, advancing financial market knowledge, innovation, and governance across Ghana’s banking sector. ([email protected], +233240402075)

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