Reset interest rate to accelerate private sector growth – Dr. Kwabena Boamah

Managing Director of Stanbic Investment Management Services (SIMS), Dr. Kwabena Boamah, has asked managers of the economy to take advantage of the current economic challenges to reset interest rate to accelerate private sector growth and quicken the recovery of the economy. Dr. Boamah said this at the 2023 edition of The Money Summit (TMS) in Accra.

Addressing a question on how financial institutions can help the private sector to lead the economic recovery process post the domestic debt exchange programme (DDEP), Dr. Boamah said resetting the interest rate is one of the opportunities in the current economic crisis the country can leverage to spur private sector growth. He said, “One of the positives, when it comes to these economic crises, is the opportunity to reset the economy as far as interest rates are concerned. It is impossible for the private sector to grow and lead economic recovery when they borrow at a rate upwards of 30%. If we are able to reset the economy in terms of interest rates, banks will be able to fund the private sector and that is one thing we can pick from the current crisis.”

Dr. Kwabena Boamah also assured Ghanaians and businesses that banks in the country are in a position to support the economy despite the very turbulent economic situation they are operating in currently. Dr. Boamah, in responding to whether or not banks are able to support growth given their performances last year said, “Banks have enough liquidity to support growth and the Bank of Ghana also has enough liquidity support for commercial banks where necessary. The key issue is for them to stay focus on what they are doing and ensure that at any point in time, they meet the obligations in terms of customer deposits. If you look at the banks that have published their financials, for example, you will see that their first quarter 2023 figures are showing profits. It’s a positive indication and the trust that the economy will bounce back and this should give all of us some confidence.”

The Money Summit is organized by the Business and Financial Times as a platform that brings together financial and economic minds to deliberate on topical economic issues. This year’s edition, which was held under the theme ‘Africa’s Robust Financial Sector: The Catalyst for Sustainable Economic Growth’ saw the domestic business community’s highest echelon attempt to make sense of the current economic landscape, and proffer workable solutions and areas for public-private collaboration.