Prez Nana Worried Over High Interest Rates

THE PRESIDENT, Nana Addo Dankwa Akufo-Addo, has expressed concern over the high levels of interest rates in the country.

The Bank of Ghana (BoG) quotes the current interest rate in the country at 15.2%.

The President believes this is not only affecting doing business in Ghana, but also the development of the private sector. He, therefore, wants the International Finance Corporation (IFC), the BoG and the Ministry of Finance to find a means to bring down interest rates, preferably to 8%.

The President expressed the concern when Vice-President of the IFC middle east and africa, Sergio Pimenta called on him at the Jubilee House in Accra yesterday.

“The interest rates in Ghana are still relatively high; we are still in double digit rates of interests, whereas really what the Ghanaian private sector has to be looking at are single rates – some 8% maximum,” President Akufo-Addo said.

“I believe that with the influence of an organization like yours and the experience from across the world, this should be a major focus of your staying with us; how you and the Ministry of Finance and the Bank of Ghana can put your heads together to address this issue because, obviously, the entrepreneurial capacities and capabilities of the Ghanaian is no longer an issue, it is well established,” he added.

The President was confident that Ghanaian entrepreneurs could do better than they are doing at present.

“But where does the entrepreneur turn for $200,000 initial support from the bank?”, he asked rhetorically, saying “they go to micro finance institutions who are taking not just an arm and a leg but both arms and both legs from the entrepreneur in terms of rates of interest that they are charging and, therefore, do not represent a serious alternative.”

Sergio Pimenta, on his part, commended President Akufo-Addo and his administration for what he described as the “amazing results that the country is having in terms of macro stability, improvements in the economy and reforms in the banking sector”, and the fact that Ghana would be hosting the Secretariat of the African Continental Free Trade Area (AfCFTA) headquarters.

For him, these were all indications of the level of confidence in Ghana and a good base for further developing the country.

In the past five years, he indicated that the IFC had invested almost $2 billion and mobilized some funds worth billion dollars in the country.

The IFC, therefore, wants to explore new ways to help the private sector so that Ghana could have more impact without having a big burden on the budget of the state.

The IFC is currently looking at areas like agriculture and agri-business, Information Technology and value chain addition processes to create more jobs.

Source: Daily Guide