Dr. Ernest Yedu Addison, the governor of the Bank of Ghana (BoG), has categorically denied allegations that the central bank is not independent from the government.

He emphasized the bank's performance during the previous eight years when speaking on Joy News' PM Express Business Edition on January 2. He emphasized that the organization has continuously worked autonomously in spite of outside opinions.

"I think the Bank of Ghana has operated very independently," Dr. Addison said unequivocally in response to inquiries over the BoG's autonomy. The record is self-explanatory.

He cited numerous years of government deficit finance being zero as proof of this independence.

He underlined, "People don't think that there was zero financing in 2017, zero financing in 2018, and zero financing in 2019."

You now had COVID in 2020. Parliament approved the government's request to the central bank for GH¢10 billion. After much work by the central bank, we returned to zero financing in 2021.

The pandemic-induced crisis in 2022 required some action, Dr. Addison explained, but emphasized that these deviations were not representative of standard procedures.

"People who don't think the bank is independent don't know what the problems are," he remarked.

"I don't buy into that argument that the Bank of Ghana needs to be made more independent," Dr. Addison stated unequivocally when asked if the BoG needs more reforms to increase its independence. The Bank of Ghana can function well just the way it is, in my opinion.

Rather, when it came to borrowing from the central bank, he urged legislative changes that would guarantee accountability.

"What I do believe in is amending the Act to make sure that governments pay for the loans they take out," he clarified.

Dr. Addison further clarified misunderstandings over the BoG's financial losses, specifically the GH¢60 billion deficit that was published.

He said that these losses covered decades of unpaid government debt rather than being accumulated in a single year.

He said that the GH¢60 billion was not borrowed in a single year.

These are loans that date back to the PNDC era. All you need to do is figure out how much of that GH¢60 billion came from 1970 to 1980. What was the cost between 1980 and 1990? How much did it cost between 1990 and 2000?

Dr. Addison proposed changes to guarantee that government borrowings be paid back within the same fiscal year in order to avoid such long-term accumulations.

"You won't accrue debt over the decades that it has been done over the last 20 or 25 years once we are able to implement reforms that require governments to repay in the same year," he stated.

In addition to stressing the necessity of systemic changes to address legacy issues, Dr. Addison's comments reflect the BoG's dedication to preserving its independence.

"The autonomy of the Bank of Ghana is a record, not just a principle," he stated.

Source: Adomonline.com