BoG Governor Flags Commodity Dependence and Dollar Strength as Key Vulnerabilities to Stability Outlook
Governor of the Bank of Ghana, Dr Johnson Pandit Asiama, has underscored the urgent need for deeper structural reforms to address Ghana’s persistent exposure to external shocks, citing the country’s narrow commodity export base as a major source of vulnerability.
Speaking to business journalists at the 127th Monetary Policy Rate briefing, Dr Asiama said Ghana’s reliance on crude oil, cocoa and gold – largely exported in their raw form – continues to leave the economy heavily susceptible to fluctuations in global markets and movements in the US dollar.
“We are basically another commodity-exporting country; if the US dollar strengthens for any reason, and anything happens there that has nothing to do with Ghana, that will have a very significant impact on us,” he noted.
He explained that although the Central Bank is building adequate reserves to cushion the economy, value addition remains essential to securing long-term macroeconomic stability.
“My worry is that we don’t tackle some of these vulnerabilities. We are doing our part by building reserves, but I want to see more structural programmes. Can we do more processing? More value addition?” he quizzed.
Dr Asiama, however, expressing hope, pointed to ongoing initiatives in the budget targeting increased processing of oil, cocoa and gold. He emphasised that the establishment of gold-related financing structures should be accelerated to boost domestic beneficiation.
Referencing cocoa, he suggested the possibility of establishing processing facilities in consumer markets such as Switzerland to capture more value along the supply chain.
“For me, that is one thing I would want to see. If we are able to add more value, that will address our vulnerabilities and help preserve the stability we’ve achieved,” he added.
The Governor further disclosed that the Central Bank continues to work closely with the Finance Ministry on strategies to strengthen the economy’s resilience. He expressed optimism that the structural measures outlined in the budget will be pursued aggressively.
“I want to believe that these things are going to be pursued aggressively, and things should be all right,” Dr Asiama assured.
