Economist Dr. Paul Appiah Konadu has expressed concern over Ghana’s high interest rate environment and inconsistent power supply, cautioning that these issues could hinder the effective implementation of the government’s 24-hour economy initiative.
Dr. Konadu noted that smallholder farmers and SMEs operating in critical sectors such as agribusiness and manufacturing are facing significant challenges, with interest rates soaring above 30 percent.
He emphasized that the combination of high borrowing costs and short loan tenures makes it extremely difficult for businesses to expand, remain competitive, or sustain operations.
He urged the government to introduce targeted measures to ease the financial burden on businesses and to prioritise reforms in the energy sector as part of broader efforts to support economic growth and resilience.
” It is difficult for smallholder farmers, for SMEs in the agri-processing value chain in the manufacturing value chain, in other sectors of the economy, to thrive at interest rates in excess of 30 percent. Loan turnovers will not go beyond three years. And so, you take a loan, even before you start reaping the benefits in terms of expansion and production, in terms of EPCs, you have to start servicing the loan.
I think the 24-hour economy is a beautiful policy government, but it is important that we have the political and macroeconomic environment enabled, that power is supplied 24-7, and affordable, because the individuals cannot survive on a 12-hour production shift because of unreliable power supply. How do they move into a 24-hour economy?”
Dr. Konadu emphasised the importance of effectively implementing Ghana’s economic policies, particularly those aimed at accelerating export development and transforming the agriculture sector.
He called for a strengthened agricultural value chain that supports year-round value addition to raw materials, ensuring fair pricing for farmers.
” I think one of the key issues that we really need to put the emphasis on is market. Look at the agriculture sector for instance. The challenge over the years has not been so much about production, because even the little we produce, conservative losses has led to a situation where farmers are always discouraged going to a farm the next farming season.
And so, if we can develop an agriculture value chain, for instance, making sure that we have around the clock value addition to agriculture raw material that alone will guarantee the right prices for our farming.”
