BOG GOVERNOR PLEDGES TO REDUCE LENDING RATES BELOW 10% BY 2028 TO BOOST GHANA’S INDUSTRIAL GROWTH
The Governor of the Bank of Ghana (BoG), Dr. Johnson Pandit Asiama, has pledged a significant reduction in lending rates to below 10 percent before the end of his four-year term, promising a major boost for Ghana’s industrial sector and broader economic transformation.
Speaking at a corporate forum organized by the Association of Ghana Industries (AGI) in Accra, Dr. Asiama acknowledged the crucial role of the manufacturing sector in driving economic development. However, he noted that persistent high lending rates remain a major barrier to growth and expansion.
“Every factory floor, warehouse, or innovation you push forward brings our macroeconomic story to life,” the Governor remarked, highlighting the sector’s importance to the nation’s progress.
Despite challenges such as regulatory hurdles, competition from imports, and skills gaps, limited access to affordable finance continues to constrain industrial growth. Dr. Asiama emphasized that the prevailing high interest rates are detrimental to businesses seeking working capital and operational funds.
At the most recent Monetary Policy Committee meeting, the BoG maintained the policy rate at 28 percent to consolidate recent gains in disinflation, despite inflation steadily falling from 23.8 percent in December 2024 to 21.2 percent in April 2025, and the Ghanaian cedi showing signs of relative stability.
Defending the conservative stance, Dr. Asiama explained, “We are choosing this discipline today so industry can thrive tomorrow in a low-inflation, low interest rate environment that rewards productivity.”
He underscored the Bank’s commitment to restoring macroeconomic stability, rebuilding investor confidence, and laying a credible foundation for sustainable and inclusive growth.
“My vision is to see lending rates fall to less than 10 percent before the end of my term,” Dr. Asiama affirmed, signaling a clear policy priority to improve access to finance for businesses.
The Governor also highlighted the importance of collaboration between the Bank of Ghana and the AGI, proposing quarterly consultative forums and sector-specific research partnerships to address credit access and foreign exchange policy bottlenecks.
Acknowledging that trust in the economy is the most valuable currency, Dr. Asiama expressed optimism that improved macroeconomic conditions will foster greater private sector-led expansion, particularly in industrial production, exports, and job creation.
Ghana’s economy grew by 5.7 percent in 2024, buoyed by robust activity in services and industry. The country recorded a trade surplus of US$4.1 billion in the first four months of 2025, with a current account surplus of US$2.1 billion in Q1, supported by strong gold and cobalt exports.
Gross international reserves stand at US$10.7 billion, sufficient to cover about 4.7 months of imports, providing a buffer against external shocks. The Ghanaian cedi has appreciated by 24 percent against the US dollar, reversing a steep 90.2 percent depreciation recorded in 2024.
While the BoG is not targeting a specific exchange rate, Dr. Asiama noted that the cedi is seeking an “optimal path,” with policy to adjust as needed to maintain stability.
Addressing concerns about economic stability amid ongoing debt servicing obligations, the Governor assured that cash flow projections and debt payment schedules are well managed.
Dr. Asiama identified measures to stem foreign exchange leakages, including efforts with the Ghana National Petroleum Corporation (GNPC) and Ghana Minerals Commission (Goldbod), as well as initiatives to track remittances more effectively.
He refuted claims of artificial currency stimulation, emphasizing that the cedi’s gains are the result of “deliberate, coordinated, and credible policy action.”
“The stabilization we are witnessing is real, though fragile. It must be protected, deepened, and translated into sustained broad-based growth,” he concluded.
Source:NKONKONSA.com
