Ghana’s persistently high lending rates are stifling private sector expansion and job creation, according to Solomon Owusu, a prominent figure in the Movement for Change.
Speaking on a July 26 business news programme, Owusu acknowledged government progress in stabilising inflation and fiscal indicators but argued these gains haven’t translated into tangible benefits for citizens, particularly unemployed youth.
He identified interest rates exceeding 23% as a critical barrier preventing businesses from thriving and competing regionally.
“The clarion call is that the youth are looking for jobs, but you don’t create jobs by only focusing on government employment,” Owusu stated. He highlighted the limited capacity of the public sector, estimating it can absorb only about 700,000 people, emphasizing that the bulk of employment must originate from a vibrant private sector.
Owusu pointed to significantly lower rates in neighbouring countries like Togo, where borrowing costs are below 5%, questioning Ghanaian competitiveness: “How do we expect our private sector to compete?”
Owusu called for an urgent economic policy shift prioritizing affordable credit access. He stressed that reducing borrowing costs is fundamental for stimulating enterprise growth and tackling the nation’s high youth unemployment rate. His comments reflect widespread private sector concerns that macroeconomic stability alone is insufficient without enabling practical business conditions.
Finance Expert Lauds Indigenous Bank Support
Contrasting with Owusu’s critique, Professor Godfred Bokpin, a finance expert at the University of Ghana, commended recent government efforts to bolster indigenous banks.
He specifically praised Finance Minister Dr. Cassiel Ato Forson for steering initiatives aimed at enhancing the capacity of state and local banking institutions to drive inclusive economic growth. “If you look at the board composition and the direction they are giving… I think that is commendable and we need to do more,” Prof. Bokpin stated.
Bokpin singled out Ghana Commercial Bank (GCB) as strategically vital, urging its transformation into a financial powerhouse capable of supporting major investments. “In the next five years, GCB must have the balance sheet to handle big-ticket transactions.
Without that, we cannot achieve the kind of economic transformation we envision,” he asserted. He further pressed the government to provide concrete policy support and capital backing to state-owned financial institutions like GCB and the National Investment Bank (NIB), moving beyond rhetorical support.
