Ghana Lawmakers Demand Funding Plan for Stalled US$895 Million Pwalugu Dam
Ghana · INFRASTRUCTURE
Key Facts
- —The country Ghana, on West Africa’s Atlantic coast, has about 35 million people and an economy of about US$114 billion (World Bank, 2025), under 0.4% of the US economy.
- —Why it matters Its poor, dry north floods almost every year when neighbouring Burkina Faso opens the spillways of its Bagre Dam upstream on the White Volta river.
- —Why now The government is preparing its 2027 budget, and lawmakers say a promised revival of the stalled Pwalugu dam means nothing without money behind it.
- —What happened On 1 October 2026, Parliament’s agriculture committee asked the government to say how it will fund the dam before the 2027 budget is read.
- —The numbers Parliament approved a US$895.43 million contract with China’s POWERCHINA in February 2020. About US$11.9 million was paid as an advance, but work on the dam itself never began.
- —What it means for you Firms eyeing farming, food processing or power in northern Ghana should not plan around Pwalugu yet: no funding source, timetable or revised cost has been published.
- —Still open Who will pay, whether POWERCHINA stays on the job, and whether Ghana can borrow abroad for it after its International Monetary Fund (IMF) programme.
Six years after approving it, Ghana’s Parliament still cannot see how the country will pay for a US$895 million dam meant to tame floods and feed its north.
Ghana’s lawmakers want answers on Pwalugu Dam financing before the 2027 budget. The dam, approved in 2020, was meant to bring power, irrigation and flood control to the country’s poor north.
Ghana is a West African democracy of about 35 million people, best known abroad for gold and cocoa. Its north is drier and poorer than the south, and floods almost every rainy season.
What Parliament wants on Pwalugu Dam financing
In remarks reported on Thursday, 1 October 2026, Dr Godfred Seidu Jasaw spoke to journalists during a committee visit to the Konadu irrigation project in Ghana’s Eastern Region. He chairs Parliament’s Food, Agriculture and Cocoa Affairs Committee.
“The government has committed; we are informed they have committed to making sure that the project is revived, but again, it’s a function of financing,” he said.
He said the previous government had relied on Ghana’s own budget to pay for the dam. In 2025 and 2026, the capital budget of the agriculture ministry was too small for a project of this size, he added.
“We must be able to tell where the Pwalugu irrigation project starts, where its financing is coming from, particularly before the reading of the budget for 2027,” Dr Jasaw said.
The committee is still waiting for the government to say which financing model it has chosen. Dr Jasaw said lawmakers would follow up to check that the promised money is actually secured.
A dam approved in 2020 and still not built
Pwalugu lies on the White Volta river in Ghana’s Upper East Region, close to the border with Burkina Faso. Then-President Nana Akufo-Addo cut the sod in November 2019, promising to end flooding caused by Bagre Dam releases.
The plan combined a 60-megawatt hydropower plant, a 50-megawatt solar farm and irrigation for about 25,000 hectares (about 62,000 acres). It was billed as Ghana’s first hydro-solar hybrid and its largest irrigation scheme.
In February 2020, Parliament approved a US$895.43 million contract agreement for the project. The builder is the Power Construction Corporation of China, known as POWERCHINA, a large state-owned Chinese engineering group.
The work was split into two separate contracts, one for the dam and power plants and one for irrigation. The irrigation contract alone was worth about US$404.8 million, according to Ghana’s irrigation agency.
The money already paid to the contractor
The Ghana Irrigation Development Authority (GIDA), the state agency that runs irrigation schemes, said in May 2024 that POWERCHINA had received about US$11.95 million. It was an advance on the irrigation contract, paid in three instalments.
That sum was a quarter of the US$48.57 million advance the contract allowed, according to GIDA. The agency said a guarantee from Stanbic Bank covered the payment.
GIDA said the contractor moved to the site in April 2021. It said POWERCHINA delivered design studies, a camp and about 9 kilometres of access roads, but no dam.
In March 2026, Energy Minister John Jinapor told a parliamentary committee that the contractor “took the money and bolted” and left Ghana. POWERCHINA’s response to that claim has not been reported.
A new government, a smaller first phase
John Mahama, president since January 2025, said in February 2026 that the project would be rebuilt in two phases. The first would focus on electricity, the second on canals, pumps and irrigated farmland.
Mahama said the hydropower part should produce 60 to 70 megawatts, with 30 to 40 megawatts of solar added. He did not give a cost or a start date for the first phase.
Money is the problem. Jinapor said in March that Ghana was asking its finance ministry for new funding. He added that the country’s programme with the International Monetary Fund (IMF) made foreign loans hard to raise unless they were grants.
Ghana defaulted on most of its foreign debt in December 2022 and has been rebuilding its finances since. Any new borrowing for Pwalugu Dam financing will be watched closely by creditors and the IMF.
Why the floods and food matter
Burkina Faso’s Bagre Dam sits upstream on the White Volta. When its operators open the spillways in the rainy season, water flows south and floods farms and villages in northern Ghana.
Pwalugu was meant to hold back part of that water and use it for year-round farming. Supporters say it would cut Ghana’s reliance on tomatoes and other vegetables trucked in from Burkina Faso.
Irrigation schemes take years to plan and build, which is why the committee wants clarity early. “Irrigation projects take time, a long while to develop,” Dr Jasaw said.
What to watch before the 2027 budget
The first test is whether the 2027 budget names a funding source and an amount for Pwalugu. A line item without secured money would leave lawmakers’ questions unanswered.
The second is whether POWERCHINA stays on the project, or whether Ghana ends the contract and tenders again. Officials have not said which way they will go.
For now, Pwalugu is a dam with an approved contract, a partly paid builder and no published plan to finish it. Parliament says it will keep asking until there is one.
Frequently Asked Questions
How much is the Pwalugu Dam project worth?
Ghana’s Parliament approved a US$895.43 million contract agreement for the Pwalugu Multipurpose Dam in February 2020. The builder is POWERCHINA, a state-owned Chinese engineering group.
Why has work on the Pwalugu Dam stalled?
The project has had no secured funding since it began. Ghana’s own budget has been too small to pay for it, and borrowing abroad has been difficult since Ghana’s 2022 debt default.
What is Parliament asking for?
On 1 October 2026, the agriculture committee asked the government to say how Pwalugu Dam financing will work before the 2027 budget is read. It wants proof that the money is secured.
Why does the dam matter beyond Ghana?
It sits downstream of Burkina Faso’s Bagre Dam on the White Volta river. It was designed to hold back floodwater released from Bagre and to irrigate about 25,000 hectares of farmland.
Connected Coverage
Sources
- Citi Newsroom: Parliament seeks clarity on Pwalugu financing (1 Oct 2026)
- Graphic Online: GIDA statement on the US$11.9 million payment
- Citi Newsroom: Energy Minister on the stalled dam (24 Mar 2026)
- Citi Newsroom: Mahama on the phased plan (10 Feb 2026)
- Citi Newsroom: sod-cutting and project design (29 Nov 2019)
- World Bank: Ghana population and GDP
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