Bank of Ghana (BoG) Governor, Dr. Johnson Pandit Asiama, has stated that the central bank’s policy effectiveness remains robust despite the repercussions of the 2022 Domestic Debt Exchange Programme (DDEP).
Although the BoG faced technical insolvency following the debt restructuring, Governor Asiama has emphasised that the institution’s independence and operational capabilities are intact.
Speaking at the Governor Talks Series at the ongoing World Bank/IMF Annual Meetings in the United States, he reassured stakeholders that the BoG remains steadfast in its commitment to maintaining monetary and financial stability, underscoring its continued functionality.
The bank, in 2023, posted an operational loss of GH¢13.23 billion, which narrowed to GH¢9.49 billion in 2024. Despite this, Dr. Asiama has indicated that Ghana’s central bank “policy solvent,” maintaining its ability to conduct monetary operations and fulfill its mandate without hindrance.
“The domestic debt issue has impacted, to a large extent, on our balance sheet. The central bank itself is policy solvent, but then, technically, you can say we are almost insolvent. The challenge is to be able to correct and to repair our balance sheet within a short time, but we are looking at it as a medium-term problem. And that said, operationally, we are able to function,” he clarified.
The BoG boss also rejected the assertion that the government is making intervention at the bank’s operations as a result of its weakened financial position.
“I must say that even at current levels, we have our independence. In no way are we controlled by the government. We are not constrained in any way at all,” he insisted.
Meanwhile, in its attempt to avoid future risks of fiscal dominance, Dr. Asiama revealed that the BoG is advancing legislative amendments to strengthen its autonomy.
“A number of reforms that we are making to the Central Bank Act should permit us to be able to hold that anchor going forward,” he explained. “We need to define, for example, what constitutes an emergency… So yes, the legislation will help to strengthen our independence going forward.”
We will not compromise on the monetary policy stance even as we ease – BoG Governor @IMF
