Ghana must harness diaspora remittances as engine for economic growth, Terkper argues

Ghana needs to fundamentally rethink how it manages remittances from its diaspora, moving beyond viewing them as household support to treating them as a critical development resource. This is the position of Presidential Advisor on the Economy and former Finance Minister Seth Terkper, who has outlined a case for greater strategic deployment of diaspora funds at a time when Ghana faces tighter access to traditional concessional financing.

Speaking at the launch of Region 17, Terkper argued that as Ghana transitions towards higher-income status, it cannot sustainably rely on declining external grants and loans. Instead, the country must build domestic financing capacity and unlock alternative funding sources—with diaspora remittances emerging as one of the most promising levers available.

Remittances beyond household survival

Currently, diaspora remittances are largely treated as personal transfers that support families and informal investments in housing and small businesses. Terkper's argument is that this approach leaves significant potential untapped. He contends that with the right policy framework, remittance flows could be channelled more systematically into productive sectors such as manufacturing, infrastructure, technology and formal entrepreneurship.

The former Finance Minister noted that remittances already support entrepreneurship, housing development, investment and knowledge transfer to Ghana. The gap, he suggested, lies not in the diaspora's willingness to contribute but in Ghana's ability to create the institutional and policy environment that would attract and direct these funds towards transformative projects rather than consumption or informal savings.

Terkper stressed the need to "diagnose the nature of remittances" and develop targeted strategies that recognise diaspora investors not merely as relatives sending money home, but as potential partners in Ghana's economic development.

Why it matters for Ghana

Ghana's recent debt crisis and partial sovereign default have made the case for alternative financing urgent. With concessional lending drying up and investor confidence weakened, the country faces a financing gap that traditional sources cannot fill. The diaspora represents a substantial, recurring source of foreign exchange and capital that operates outside the debt dynamics that have constrained Ghana's fiscal space.

The World Bank and IMF have estimated that remittances to sub-Saharan Africa exceed official development assistance in most years. For Ghana specifically, diaspora transfers represent billions of cedis annually—money that could be mobilised for infrastructure, education, healthcare and industrial development if properly structured.

Beyond the financial case, Terkper's argument taps into a broader truth: countries that have achieved sustained growth—whether the "African Lions" he cited or other emerging economies—have done so partly by building on diaspora networks and capital. This requires not just convincing Ghanaians abroad to send more money, but demonstrating credible, transparent and profitable investment opportunities at home.

Rebuilding confidence and mobilising resources

Terkper acknowledged that Ghana's debt crisis has damaged confidence among both local and diaspora investors, underscoring that policy credibility is essential. Reopening the diaspora as a development partner requires consistent macroeconomic management, transparent public institutions, and demonstrable returns on investment.

His call aligns with growing recognition among policymakers that Ghana's recovery depends not on aid or borrowed money, but on mobilising resources that already exist—both within Ghana and within the diaspora. The challenge ahead is converting this acknowledgement into concrete policies, from diaspora bond schemes and investment funds to business registration and property rights reforms that make Ghana an attractive destination for diaspora capital.