Economist and finance lecturer at the University of Ghana Business School, Professor Lord Mensah, has warned against political interference in the operations of the Bank of Ghana (BoG), arguing that past executive influence weakened the central bank’s independence and contributed to Ghana’s economic difficulties.
According to him, the previous administration’s lack of respect for the BoG’s autonomy led to policies that compromised its role as a stabilizing force in the economy. This undue political influence contributed to Ghana’s current economic struggles, including high inflation, currency depreciation, unsustainable debt levels, and a weakened financial sector.
“The two deputies and the governor himself compromised their independence. They gave too much respect to the Executive, and that is what brought us to where we find ourselves now,” Prof. Mensah remarked.
His comments come in the wake of President Akufo-Addo‘s nomination of Dr. Zakari Mumuni as the First Deputy Governor of the Bank of Ghana, pending approval from the Council of State. Another appointment is expected soon to replace Dr. Elsie Awadzi, who is set to take an early retirement from the central bank, effective February 28, 2025.
Speaking to Citi Business News, Prof. Mensah emphasized that while the BoG has some operational autonomy, its leadership appointments are subject to executive influence, making it even more critical for individuals in top positions to uphold their independence.
“Even if you are appointed, you need to look at the function rather than the person who appointed you. The independence is very important so that as a Central Bank, even though our constitution does not give us enough leeway to get an independent Central Bank, the individuals appointed should be able to stand on their own,” he stated.
He further urged the executive branch to respect the central bank’s role in safeguarding the country’s financial stability, noting that a repeat of past mistakes could further destabilize Ghana’s economy.
“There should be respect that the Executive will give to the Central Bank. We didn’t get that in the previous administration when it comes to the relationship between the Executive and those spearheading the Central Bank,” he pointed out.
Prof. Mensah believes the new BoG leadership must prioritize professionalism over political loyalty, ensuring that monetary policies are designed to protect the economy rather than serve short-term government interests.
“The Finance Minister of the day should have enough respect for the Central Bank because it forms a bank for the State,” he concluded.
