The Governor of the Bank of Ghana, Dr. Ernest Addison, in a recent address at the Governor’s Day organized by the Chartered Institute of Bankers, emphasized the prudence with which the central bank managed the economic challenges faced by the country in 2022 as againts numerous reports of minsmanagement.
Dr. Addison asserted that rather than facing unwarranted criticism, the Bank of Ghana deserves applause from the Ghanaian public.
Commending the central bank’s role as a stabilizing force during the crisis, Dr. Addison pointed out that the economic challenges were not unique to Ghana but were experienced by several other frontier and emerging market economies worldwide.
He mentioned countries such as Egypt, Argentina, Turkey, Kenya, and Pakistan, highlighting that those with strong policy buffers and resilient institutions weathered the storm more effectively.
“It is important to remind ourselves, as players in the global economy, that the crisis that hit the Ghanaian economy in 2022 was like what pertained in many other frontier and emerging market economies, including Egypt, Argentina, Turkey, Kenya, Sri Lanka, and Pakistan, just to mention a few. These countries, except for Sri Lanka, had built policy buffers and the resilience of their key institutions provided the needed anchor to hold their economies until reform packages were introduced.”
Dr. Addison acknowledged the central role played by the Bank of Ghana in preventing the Ghanaian economy from succumbing to the pressures of the crisis. He noted that the strong policy buffers built over time allowed the central bank to support the economy until the conclusion of the International Monetary Fund (IMF) program.
The Governor addressed the misunderstandings and criticisms the Bank of Ghana faced during the crisis, stating, “The Bank’s role in supporting the economy through this crisis has not been fully understood and, in some cases, deliberately misinterpreted.” He mentioned media attacks and an organized demonstration against the institution.
Dr. Addison highlighted the evolution of central banking globally since the 2007/2008 financial crisis, emphasizing the expanded role of central banks in stabilizing economies through unconventional monetary policies.
He explained that the economic crisis exposed a gap between theory and practice and defended the Bank of Ghana’s actions as consistent with prudent crisis management.
Dr. Addison further emphasized that only a central bank that has been prudently managed, with built buffers and a well-positioned stance, can effectively support an economy on the brink of collapse. He urged Ghanaians to applaud and commend the resilience of the Bank of Ghana in navigating and mitigating the economic challenges faced by the nation.