Renowned business magnate and seasoned investment banker Togbe Afede XIV has voiced strong reservations regarding the Bank of Ghana’s (BoG) allocation of $250 million towards constructing a new head office, labelling it as “insane” for a country grappling with economic challenges.
In his latest article shared with The Accra Times, Togbe Afede XIV, who previously served on the board of the Bank of Ghana, said details of BoG’s 2022 annual report “say a lot about our mentality”.
Pointing to various reported expenditures, including $97.4 million for travel, $131 million for motor vehicle maintenance and running, $32 million for communication, $67 million for computer-related expenses, $207.7 million for premises and equipment, $336.9 million for currency issue, and $287.83 million for other administrative expenses, Togbe Afede described these figures as equally insane. He lamented the apparent lack of fiscal prudence within the Central Bank, suggesting that its management and staff are detached from the economic reality faced by ordinary citizens.
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Togbe Afede XIV, who is the Agbogbomefia of the Asogli Traditional area, questioned the rationale behind BoG’s lavish investments in non-core activities such as a hospital and guest houses, arguing that they do not justify the colossal expenses. Drawing comparisons with the Bank of England, he characterised BoG’s situation as “the poor living like the King.”
Despite facing public criticism, BoG Governor Dr. Ernest Addison defended the construction of the new head office, citing the inadequacy of the current facility built in the 1960s. He clarified that the decision to commence construction was made in 2019 when the bank was profitable and appropriations for the project were made from profits generated in 2019, 2020, and 2021.
However, Togbe Afede remains sceptical, asserting that BoG’s expenses cannot be justified. He accused the Central Bank of maintaining a high monetary policy rate to finance its expenditures.
“The reality, as I stated in my most recent article, is that BOG, given its excessive operating and other expenditures, may not be able to hold its own in a low-interest rate environment. So, the Bank has the incentive to keep its policy rate high to protect its main revenue source, interest income,” he added.
This critique of the Bank of Ghana is not new for Togbe Afede, dating back to 2003, when he challenged its inflation-targeting regime. Despite his past appointment to the Board of the Central Bank, spanning a ten-year period under different political administrations, his concerns regarding fiscal responsibility and economic management persist.
