Economist and Lecturer at Academic City University, Dr Paul Appiah-Konadu has warned against Ghana’s persistent high lending rates arguing that it will eventually when not addressed undermine Ghana’s efforts in job creation and reducing unemployment.
Speaking on Ghana’s unemployment crisis and private sector involvement , Dr Paul Appiah-Konadu added that although interest rates have fallen significantly from the levels recorded during the 2022 economic crisis, the current lending rates of about 16 to 19 percent remain too high for the private sector for expansion and job creation.
He added that small and medium-sized enterprises, which dominate Ghana’s economy, require affordable credit to invest, expand their operations and employ more workers.
According to him, businesses will struggle to create jobs if the cost of borrowing remains high.
Dr Appiah-Konadu therefore urged government to maintain fiscal discipline and reduce its demand for domestic borrowing, which could help bring down Treasury bill rates and ultimately lower lending costs.
He also called on the Bank of Ghana to continue reviewing its monetary policy rate to create room for further reductions in the cost of credit.
He believes lending rates should eventually fall below 10 percent if Ghana is to achieve meaningful private-sector expansion.
“We need to make sure that interest rates are coming down probably below 10 percent such that the private sector can borrow at a more affordable cost,” he said.
His comments comes at a time where Ghana’s general unemployment rate stands at 13.0% as at the third quarter of 2025 according to the Ghana Statistical Service (GSS) Labour Force Survey, while macro-model annual estimates using broader definitions place the yearly average around 2.98%.
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