Togbe Afede XIV, the Agbogbomefia of the Asogli State, has recommended a substantial restructuring of the Bank of Ghana (BoG) to improve its effectiveness.
In his article dated April 11, 2024, Togbe Afede XIV emphasised that the BoG’s policy of maintaining high interest rates, to the detriment of the real sectors, is not a prudent central banking strategy.
“BOG requires drastic restructuring to make its operations more efficient, and to align its objectives to those of the state and ensure a sincere pursuit of stability. Maintaining a high interest rate environment that ensures that our banks, including BOG, make abnormal profits at the expense of the real sectors is not good central banking practice.”
He accused the BoG of corruption, poor fiscal policy, and macroeconomic mismanagement, stressing the need for restructuring if it is to survive in a normal interest rate environment.
“A central bank’s raison d’etre is not profits, but stability, where BOG has failed woefully, even though corruption and poor fiscal policy and general macroeconomic mismanagement are contributory factors. Restructuring is necessary at BOG, if it should be capable of surviving in a normal interest rate environment,” he opined.
The Agbogbomefia of the Asogli State emphasised the need to scrutinise the staff numbers of BoG, its associated costs, and its procurement practices.
“Attention should be paid to its governance system, staff numbers and costs, procurement practices, growing obligations to former staff, and mandate. Regarding its mandate, there is a strong case for BOG relinquishing its government treasury management function (to focus on regulation) because of conflict with its profit motivation,” he asserted.
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