BoG Lost Its Independence Under NPP, Leading to Debt Exchange Crisis – Banking Consultant Alleges

A Banking Consultant, Dr. Richmond Atuahene, has argued that the independence of the Bank of Ghana (BoG) is essential to protecting the country’s financial system from political interference, claiming that government influence over the central bank contributed significantly to Ghana’s recent economic challenges.

In a zoom interview granted on Kessben TV’s Digest show, Dr. Atuahene insisted, the Bank of Ghana should operate independently without interference from any government, stressing that central bank autonomy is a globally accepted principle designed to safeguard sound monetary policy.
He alleged that the previous New Patriotic Party (NPP) administration dictated the operations of the Central Bank, a situation he believes ultimately resulted in the Domestic Debt Exchange Programme (DDEP).

Dr. Atuahene asserted that instead of 5% bonds that the Central Bank was legally permitted to allocate to the government , they exceeded to about 50%, rendering the bank incapable of managing its financial grounds.
“The Bank of Ghana should operate as an independent entity devoid of political interference, but the NPP government dictated its mode of operation, and that led to the Domestic Debt Exchange Programme,” he stated.

Dr. Atuahene further claimed that the debt exchange became necessary because the Central Bank had extended substantial financing to the government, weakening its financial position.
He also criticized the currency redenomination exercise, asserting that it was a government-driven policy rather than an independent decision by the Bank of Ghana.
“The redenomination was Kufuor’s policy and not Dr. Paul Acquah’s own. It was pure government interference, not Central Bank policy,” he claimed.

The banking consultant warned that Ghana currently lacks the resources needed to fully recapitalize the Bank of Ghana, suggesting that the country’s financial system may continue to feel the effects of the central bank’s losses for several more years unless decisive measures are taken.
Dr. Atuahene maintained that preserving the independence of the Bank of Ghana is critical to preventing future economic crises and restoring confidence in the country’s financial sector.

By Maurice Otoo