We have cut cost of capital by more than half since Mahama took office – Ato Forson

Finance Minister Dr Cassiel Ato Forson says the cost of capital for businesses in Ghana has fallen by more than half since President John Dramani Mahama took office.

He said the reduction forms part of government's efforts to make it easier for businesses to access bank financing and expand their operations.

"Since President Mahama took office, we have deliberately brought down the cost of capital," Dr Ato Forson said in a video.

"Cost of capital, prior to his coming, was averaging 30%. Today, it has been cut by more than half," he added.

Businesses Can Now Borrow at 9% to 13%

According to the Finance Minister, businesses can now borrow from banks at rates of between 9% and 13%.

"You'll be able to borrow from banks at 13% to 9%. But that is not where we want to go," he said.

Government Targets Single-Digit Borrowing Costs

Dr Ato Forson said government wants borrowing costs to fall further into single digits to make financing more accessible to businesses.

"We want to see cost of capital single-digit. So that businesses like yourself can borrow from our banks and expand," he said.

Access to Credit Equally Important
The Finance Minister stressed that lower borrowing costs must go hand in hand with greater access to credit.

"Not only the cost of capital, but availability is also very important," he said.

Banks Not Lending Enough to Private Sector
Dr Ato Forson expressed concern that banks are still not lending enough to the private sector.

"We see our banks not lending so much to the private sector. That should not be the case," he said.