Dr. Ernest Addison Calls for Reform to Force Government to Settle Debt Within the Same Year
Bank of Ghana Governor Urges Central Bank Act Amendment to Address Longstanding Debt Challenges
- Dr. Ernest Addison has called for a reform of the Central Bank Act
- He stressed the importance of implementing reforms that would ensure the government repays any borrowings
- To address these ongoing issues, the Bank of Ghana has been implementing a series of comprehensive reforms
Dr. Ernest Addison, the Governor of the Bank of Ghana, has called for a reform of the Central Bank Act to compel the government to repay any debt borrowed from the central bank within the same fiscal year.
In an interview, Dr. Addison emphasized that the government’s failure to settle debt promptly is having a significant impact on the operations of the central bank, creating long-term challenges for the economy.
Dr. Addison noted that the accumulation of unpaid debts over the past 20 years, particularly those dating back to the PNDC era, has contributed to growing financial instability. He stressed the importance of implementing reforms that would ensure the government repays any borrowings within the same year they are taken.
“What I propose is to implement reforms that will ensure that when the government borrows, they pay it back within the same year,” Dr. Addison said. “In the books of the Bank of Ghana, there are borrowings that date back as far as the PNDC days that have yet to be repaid.”
He also highlighted that the Bank of Ghana’s recent financial losses—totaling GH¢60 billion—are largely due to the accumulation of unpaid loans spanning multiple governments, starting from the PNDC era. Dr. Addison clarified that these were not recent borrowings, but rather long-standing debts that have been carried forward for decades.
“So when they say the Bank of Ghana has made a loss of GH¢60 billion, it wasn’t borrowed within a single year,” Dr. Addison explained. “These are loans that have accumulated since the PNDC period. If you go through the bank’s records, you’ll see which debts were borrowed in any specific year.”
To address these ongoing issues, the Bank of Ghana has been implementing a series of comprehensive reforms aimed at improving the sector’s regulatory and supervisory framework. These measures are designed to foster a more resilient banking system and ensure better management of national debt.
Dr. Addison’s remarks underscore the growing need for timely government debt repayment to stabilize the nation’s financial landscape and reduce the burden on the central bank.
