By Kingsley Webora TANKEH
Despite ongoing challenges with financing for Ghanaian enterprises and sectors—which hinder their development and enlargement—Bank of Ghana Governor Dr. Johnson Pandit Asiama has promised the commercial sector a significant decrease in interest rates below 10 percent by the conclusion of his four-year term. This move aims to support Ghana’s shift towards greater industrialization.
At a corporate event organized by the Association of Ghana Industries (AGI) in Accra, the head of the central bank recognized the significant role played by the manufacturing industry in driving economic progress. However, he also pointed out that elevated borrowing costs persistently hinder their advancement and expansion.
“He remarked that every factory floor, warehouse, or innovation we advance contributes to bringing our macroeconomic narrative into reality.”
Among the various hurdles faced by Ghanaian industries—such as complex regulations, rivalry from imported products, and insufficient expertise in financial management and marketing—the primary barrier to expansion is restricted access to financing.
The Governor voiced worry about the currently elevated interest rates, which affect businesses' expansion.
During their recent Monetary Policy Committee meeting, the central bank collectively decided to keep the monetary policy rate at 28 percent—this decision was made even though disinflation is progressing as planned and the cedi remains fairly steady.
According to the central bank’s committee, this aims to solidify the anti-inflation benefits accomplished over the past few months.
Inflation has consistently decreased over four successive months, dropping from 23.8 percent in December 2024 down to 21.2 percent in April 2025.
Even with this downturn, interest rates remain elevated and continue to affect businesses; hindering their ability to obtain working capital and operational financing needed for development and expansion.
Dr. Asiama defended the central bank’s cautious approach to monetary policy, stating: "By embracing this discipline now, we aim to foster industrial growth in the future within an economy characterized by low inflation and low-interest rates, which will ultimately reward increased productivity."
He stated that the objective of the central bank is to reinstate macroeconomic stability, revive trust among investors and markets, and establish a solid base for balanced and inclusive long-term development.
“I aim to witness lending rates drop below 10 percent by the conclusion of my four-year tenure,” he stated, highlighting the central bank’s dedication to enhancing financial accessibility in Ghana.
Dr. Asiama emphasized the importance of the AGI Corporate Forum, underscoring the central bank’s dedication to fostering a supportive economic climate for business expansion and success.
"We must facilitate increased inflows of environmentally responsible funding and private investments. By doing so, we are establishing the groundwork for an economy that isn’t merely rebounding, but also advancing with intent," he remarked.
He suggested that the Bank of Ghana and AGI should set up organized interaction methods, encompassing quarterly consultation meetings focused on industrial credit availability and foreign exchange policies, as well as industry-specific research collaborations aimed at pinpointing policy hurdles and improving communication about adjustments in regulations and developments in financial markets.
Dr. Asiama emphasized that the most significant form of wealth isn’t one measured in cash or kept in banks; rather, it’s the faith individuals place in their economic system. He stated, "With better macroeconomic circumstances, our focus will pivot more towards fostering an environment where the private sector can drive growth—especially within sectors like manufacturing, export activities, and employment generation," as reported by him.
Last year, Ghana experienced a growth of 5.7 percent in its GDP, primarily driven by robust performance in the service and industrial sectors.
In the initial four-month period of 2025, Ghana reported a trade surplus of $4.1 billion, with a current account surplus totaling $2.1 billion for just the first quarter, primarily because of exports in gold and cobalt.
The nation's gross international reserves amount to $10.7 billion, which covers approximately 4.7 months of import expenses. This acts as a buffer against external economic disruptions.
The value of the Ghanaian cedi has increased by 24 percent relative to the U.S. dollar, which is a reversal from the significant 90.2 percent devaluation observed in 2024.
The Governor disclosed that the central bank does not have any particular target for the national currency as the cedi experiences a strong upturn in value relative to the US dollar.
"The cedi is attempting to find the best route. We track the primary fluctuations between the cedi and inflation rates — this will indicate when we should ease off and allow events to follow their natural progression," he remarked.
Concerns have been raised that the current relative economic stability might only be short-lived because of the debt relief obtained through the government's external debt restructuring program, which was spearheaded by Ghana’s Official Creditor Committee chaired jointly by France and China. In response, the governor of the central bank reassured the business sector that extensive preparations are underway to manage our debt payments effectively.
"We have detailed records of all significant upcoming payments scheduled over the next one to two years. This information is compiled in our forecasted cash flow statement or chart, which indicates when additional payments will be required," he explained.
The Governor stated that achieving permanence in the stability of the nation's legal tender depends on two key measures: stopping the leakage of foreign exchange reserves from Goldbod and monitoring remittances effectively.
“We think that with the Gold Board, smuggling and other leaks will decrease, and our next step is to address remittances as well,” he stated additionally.
He, however, refuted rumors claiming that the cedi was being artificially boosted.
Our objective isn't about controlling exchange rates; rather, we aim to establish a policy atmosphere where market stability can flourish," he stated emphatically. He highlighted that the strengthening of the cedi is no coincidence but an outcome of carefully planned, collaborative, and trustworthy policy measures currently underway.
"The stabilization we see today is genuine, despite being delicate. It needs to be safeguarded, reinforced, and transformed into consistent, widespread economic expansion," he remarked.
Provided by Syndigate Media Inc. ( Syndigate.info ).
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