Ghana's central bank to focus on macro-stability, economic growth

Ghana's central bank will focus on restoring macro-economic stability and ensuring real sector growth, its new governor Abdul-Nashiru Issahaku has said.

Issahaku made the remarks at a two-day Ghana Small and Medium Enterprises (SME) Financing Fair, which opened in the capital Accra on Tuesday.

"As we work to restore macroeconomic stability with fiscal consolidation, government borrowing rates would continue to decline and this would help drive down the high lending rates among banks," Issahaku said.

It is his first public appearance after being sworn into office on Monday by President John Dramani Mahama.

The fair was organized by the government to help find solutions to the high cost of financing that small enterprises are facing in a country where interest rates have hovered above 30 percent.

Issahaku pointed out two "critical factors" against SME financing as macroeconomic conditions such as rising inflation and depreciation of the cedi, and high non-performing loans and risks linked to financing SMEs.

He said it was important for banks to support the SME financing.

"Prioritizing SME development, therefore, is critical for promoting inclusive economic growth, and that is why we continually urge banks to revise and develop new banking solutions and models to serve this market segment to engender greater financial inclusion," he said.

He added the central bank will therefore continue to implement measures to promote "healthy competition" in the banking system.

The chairman of the National Development Planning Commission, Kwesi Botchwey, on behalf of President Mahama, called on the SMEs to consider listing on the stock exchange to access long-term credit for the expansion of their businesses.

Botchwey also said the country should prioritize SME financing as they could be the backbone of the economy leading in job creation and poverty reduction. Endit