The Bank of Ghana is taking steps to protect the country’s economy as rising geopolitical tensions in the Middle East threaten global energy markets and investor confidence.
Governor Dr. Johnson Asiama said Ghana is now better prepared to handle external shocks. He pointed to stronger foreign reserves, falling inflation, and ongoing fiscal reforms under the IMF-supported program as key factors.
Speaking at a banking industry forum in Accra on Tuesday, Dr. Asiama addressed concerns about the potential economic impact of the Iran-Israel conflict. He assured the public that the Bank of Ghana is closely monitoring the situation, especially its effects on global energy prices, supply chains, and capital flows.
“The Bank of Ghana is watching the situation carefully. We know it could affect energy prices and trade,” he said. “But I want to assure everyone that Ghana’s economic buffers are stronger now than in recent years.”
The central bank is using a mix of cautious foreign exchange management, disciplined fiscal policies, and strong monetary tools to keep inflation stable and maintain confidence. Ghana’s foreign reserves have increased thanks to tighter currency controls and better matching of foreign exchange demand with actual business needs.
As of April 2025, Ghana’s Gross International Reserves stood at US$10.7 billion. This covers about 4.7 months’ worth of imports. The bank expects the external sector to remain stable, supported by growing exports of gold and cocoa, and increased remittances from abroad.
Instead of large-scale market interventions, the Bank of Ghana has adopted a market-driven exchange rate system. This approach uses improved auction processes and closer monitoring of foreign exchange activity. These steps have reduced speculation and allowed the cedi to adjust naturally to economic changes.
Dr. Asiama emphasized that the central bank is not aiming for a fixed exchange rate. “We are not targeting a set exchange rate or band,” he said. “But we are ready to act quickly and carefully to maintain macroeconomic stability.”
Inflation has been slowing steadily in recent months. It peaked above 50% in 2022 but fell to 18.4% in May 2025. Combined with positive real interest rates and stronger export and remittance flows, this has built a more resilient economic foundation.
Fiscal consolidation, a major part of the IMF program signed in 2023, is also strengthening Ghana’s ability to absorb shocks. Better budget controls and improved revenue collection are helping restore trust in government finances and reduce pressure on the central bank to print money.
Global markets remain nervous about how the Iran-Israel conflict might disrupt oil supplies, increase shipping costs, and cause investors to pull money from emerging markets. Ghana, as both a net oil exporter and fuel importer, faces these risks. However, policymakers believe that sound fiscal discipline and cooperation with international partners will lessen the impact.
The governor’s remarks come as confidence in Ghana’s economic policies slowly recovers following a difficult period of debt restructuring, currency losses, and high inflation.
“While we cannot predict exactly how things will unfold externally, our policy tools and readiness give us room to respond,” Dr. Asiama said.
Beyond stabilizing markets, the central bank is pushing for deeper structural reforms. These include building stronger digital finance systems, expanding financial inclusion, and encouraging policy innovation. Dr. Asiama argued that real resilience to geopolitical shocks depends not just on fiscal and monetary buffers but also on a more diversified and digitized economy.
