In 2017, the Bank of Ghana (BoG) embarked on a controversial journey to revoke the licenses of some banks, a move that raised questions and eyebrows across the nation. Martin Kpebu, a prominent legal practitioner, firmly believes that politics played a pivotal role in this decision, leading to severe repercussions for the Ghanaian economy. In this article, we will delve into the aftermath of the license revocations, the potential implications of a different approach, and the accusations against Dr. Ernest Addison, the governor of the central bank.
The Political Undertone
One cannot ignore the political undercurrents that seemed to steer the decision-making process within the BoG in 2017. Mr. Kpebu contends that the revocations were driven by political motivations, resulting in a wave of unemployment that has plagued the country ever since. This raises the question: Could there have been an alternative path?
Martin Kpebu reminds us of a critical juncture in American history, the 2008 financial crisis. At that time, American banks, though struggling, were deemed “too big to fail,” and measures were taken to salvage them. Drawing on this comparison, Kpebu suggests that a similar approach in Ghana might have mitigated the economic turmoil that followed the license revocations. In hindsight, it was revealed that the government could have supported these banks with a relatively modest investment, saving countless jobs and businesses.
Governor Addison’s Role
A crucial point of contention is the role played by Dr. Ernest Addison, the governor of the Bank of Ghana. Kpebu draws a parallel between Addison and Jerome Powell, the Chairman of the Federal Reserve in the United States, both facing challenging circumstances. However, while Powell engaged in an ideological battle with then-President Donald Trump, Addison seemingly aligned himself with President Akufo-Addo, making decisions that had severe consequences for Ghanaians. This alignment, according to Kpebu, has led to the perception that Addison is incompetent and has “lost the plot.”
Support for the Minority’s Call for Resignation
Given these circumstances, Martin Kpebu has voiced his support for the Minority’s planned demonstration calling for the resignation of Dr. Ernest Addison. The Minority alleges that the governor’s lack of monetary discipline in collaboration with the Finance Minister has resulted in the central bank incurring a significant loss of GH¢60.8 billion in 2022.
In retrospect, the decision to revoke banking licenses in 2017, seemingly driven by political motives, has had far-reaching consequences for Ghana’s economy.
The aftermath, characterized by high unemployment rates and economic challenges, raises questions about alternative approaches that could have been taken. The accusations against Governor Addison add another layer of complexity to this issue, leaving Ghanaians divided and seeking accountability. As the Minority’s call for Addison’s resignation gains momentum, it remains to be seen how this political and economic saga will unfold, and what lessons can be learned for the future.