The Governor of the Bank of Ghana (BoG), Dr. Ernest Addison, has categorically rejected assertions that associate the independence of the Central Bank with the government’s Debt Exchange Programme (DDEP).
He emphasized that the debt exchange initiative was a direct reaction to a significant national crisis and did not impact the autonomy of the Bank of Ghana.
“The debt exchange programme has nothing to do with the independence of the central bank,” Dr Addison said during an interview with Joy News’ PM Express Business Edition.
He characterized the DDEP as a significant national emergency that necessitated an immediate resolution to prevent the nation from facing economic collapse.
“It was a life-and-death matter for all Ghanaians. At that point, nothing else mattered. Salaries were not going to be paid. There was going to be chaos because nobody was getting their investment returns.”
Dr. Addison clarified that the Bank of Ghana’s participation in the debt exchange programme was not a reaction to economic shocks but a strategic response.
He further detailed the sequence of events, indicating that the International Monetary Fund’s recommended approach included the declaration of a debt standstill, which was subsequently succeeded by a debt exchange.
“The IMF’s approach to the crisis was clear. The Bank of Ghana had to continue financing the government to maintain stability while we worked on the programme.
“At that point, those holding government instruments were the ones impacted. What happened in October during the debt standstill could have happened much earlier in the year, but it would have been disorderly without the appropriate policies in place. This was the solution given the situation the country found itself in.”
Dr. Addison also dismissed the notion that the independence of the central bank was undermined during the crisis, emphasizing that its measures were consistent with the IMF’s framework aimed at restoring stability.
“The recent economic challenges were about survival. Let’s not oversimplify the situation.”
