Ivor Agyeman-Duah has put together a well-researched and felicitously penned history of central banking in Ghana. In the process, he gives the reader a broad brush of economic development through the establishment and growth of the Bank of Ghana.

The 553-page book of 23 chapters, Central Banking in Ghana and the Governors: Institutional Growth and Economic Development, recounts the life and challenges of the 14 governors (aside from the establishment governor) who have directed policies over the past 65 years.

This book is about one of the soft power elements of Ghana's pretensions to exceptionalism as the shining Black Star of Africa; a symbol of hope and great expectations in the intoxicating early days of political independence.

Since the beginning of the 21st Century, central banking has been one of the dazzling achievements showcasing Ghana’s claim as the Bank became the gold standard for inflation targeting, a Monetary Policy Committee with its much-awaited monthly Press Release on the state of the economy. And Ghana Interbank Payments and Settlements (GhIPS), a subsidiary of the Bank, has established itself as the premier and pioneering electronic payments system providing advisory services for other African regulators. 

This exquisitely written book on a complex and difficult subject has been made easy to read. The author’s multi-faceted and eclectic professional background allows him to take the reader through fascinating and unexpected detours such as ancient Zimbabwean-inspired artworks, insights into currency design and printing and into political drama behind economic policy decision-making after an introduction of money as a human need for a medium of exchange.

A Felicitous Book

The book should have been published when the Black Star of Africa was indeed shining brightly on the global stage, borne aloft and fueled by our exceptionalism.

It deals with institution-building and growth; engagement of people with systems which determine the success of nations. We, therefore, need men and women of deep professional competence and personal courage. For instance, Governor Amon Nikoi’s observation (p. 220) will remain hauntingly valid; that the issue of independence of the central bank is “not possible to have in a developing country, especially under military or dictator regimes.” This was in response to the lamentation of Adu-Boahen, a history professor turned politician during the regime of Flt-Lt Rawlings. His query was why central bankers could not simply tell the military dictators that they would not implement “some of their crazy and disastrous ideas.” (page 220).

The book published by Hawkes Design and Publishing in Britain with the Ghana edition by Digibooks Limited is filled with iconic photographs with each telling their own stories of former heads of state and their ministers of finance and governors long departed from 1957 when the Bank was established as a currency-issuing entity. In 2002 and at 45 years, it attained effective operational independence under Dr Paul Acquah, the monetary economist and eleventh Governor whom the author introduces as (p.343) “The Governor who Finally came from the IMF.” 

By a happy coming together of events, the Minister for Finance then was Yaw Osafo-Maafo. A mechanical engineer trained as a banker in Germany, Yaw had become ingrained with the German post-Second World War obsession with fiscal prudence and central bank independence and helped with the enactment of the 2002 Bank of Ghana (Act 612).

Ivor characterized this event as “an unprecedented operational independence” (page 368).  In the words of Paul Acquah, autonomy meant it could pursue its mandate and objectives as assigned by the enabling Act, “independent of instructions from the government or any authority” (page 348).

Acquah, a thoroughbred from the IMF arrived at the BoG with Fund orthodoxy 44 years after the bank’s establishment. He was hoping to end Ghana’s flip-flopping and return to fiscal prudence and relative macroeconomic stability. He shaped the institution into a full-fledged modern central bank.

The book is voluminous but holds the attention and is also far from ordinary in terms of its coverage and content. Ivor’s eclectic and amazingly broad professional background is imprinted all over the pages and shapes his narrative.

Perhaps the author’s most peculiar and arresting background that brings an unexpected and exotic twist is his work as visiting scholar in the history of Numismatics at The British Museum. If not unlike me, you have not come across the word numismatics, (I had to Google it) it deals with the history of coins, currency bills and issued medals. So, he begins Chapter 6 on Art and Design of Currency with our national currency, the Cedi, named after “S3de3,” the cowrie in Twi. This was our ancient medium of exchange for transactions and for a store of value before the 15th century.

Ivor delights us with currency printing from Samoa and Seychelles where the emphasis is on natural beauties, and architecture and where carbon neutrality in currency printing is important due to climate change concerns. In Ghana, the focus is on the “enhancement of security details on the banknotes” (p.130) to minimize counterfeiting. Who else but this author, would have known and regale us that the Samoa $5 tala banknote depicting the Villa Vailima beachfront, was (p.130) “the adopted home of the Scottish novelist, Robert Louis Stevenson” whose classic, Treasure Island, was a must read for my generation.

The book is divided into four Sections each with artwork from the collections of Governor JH Frimpong-Ansah, himself a painter of note and a collector of art and old maps. The sculptures are inspired by traditional artworks by the Shona ethnic group in Zimbabwe.  Frimpong-Ansah acquired the works of Richard Mteki and Albert Nathan Mamvura whose sculptures include iconic ones such as Zimbabwe’s gift to President Nelson Mandela entitled “Freedom at Last.”  The author wants to portray the governors as normal people with life interests other than just central banking (p. xx - xxi).

The Governors

These narrations start with tantalizing judgmental chapter headings such as (page 69) under Halm, “In thy Hands, we Give Thee - First Ghanaian Governor.” It's pregnant with foreboding. Was this signalling the shift of the bank from the Minister of Finance of independent Ghana, K A Gbedemah’s envisaged (p.69) “merit-based” board and management into a development bank under the direction of Nkrumah? 

Gbedemah was replaced in 1964 with Dra Gokah.  And Halm was expected to tow the new line. He came to the Bank of Ghana as a businessman. The Bank had taken a gamble. There was a bumpy ride ahead!

The shift in gears was under Albert Adomakoh, the first Ghanaian professional Governor. His tenure is under Section 2 under the title, “Decade of the Bank and Fall of Curtains.” After ten years in operation, a dramatic change was envisaged. The “Fall of Curtains” signalled the overthrow of President Nkrumah and his socialist one-party state. But before this change, Kwasi Amoako-Atta, a socialist ideologue had become minister for finance and the “hawks had assumed total control and ideological rigour was all pervading” (p. 145). Adomakoh had returned to the Bank after three years of establishing the National Investment Bank on Nkrumah’s invitation.

By August 1965, the economic situation was dire. A sobering report stated that “Ghana will enter 1966 therefore with no reserves and all obvious borrowing possibilities exhausted” (p. 149). And recurrent expenditures were ballooning as a result of the high development outlays for economic and nation-building infrastructure. Five days after the overthrow of Nkrumah, Adomakoh’s action “to assist a transition from a state-controlled economy to a liberal one” (p.150) with private sector participation was swift, bold and very public.

Governor Frimpong-Ansah was a key player in the 1972 devaluation of the Cedi that created the jinx and made it a no-go policy area for decades. For the last two months of the Busia administration, he was effectively the minister for finance.  Alongside Amon Nikoi then at Finance, they led the devaluation team teleguided by Professor Babu Niculescu, Busia’s economic advisor from Oxford university. Frimpong-Ansah worked closely with Niculescu and Dr Jones Ofori-Atta.

Alex Ashiagbor was governor through one of the most difficult periods, 1977 to 1982 when attempts were made to secure details of bank accounts and balances in order to expropriate them. Alex is quoted as saying (p.250 - 251); “Memories tend to be short. Today we take for granted the right to life and property, press freedom, freedom of debate and dissent, freedom of association and all the basic rights of a modern civil society enshrined in our constitution. But lest we forget, those who lived through 1977 - 1982 have different memories.”

He has the unique record of being the only person “to have been appointed Deputy Governor through a radio announcement in 1977 and just when he was about to be confirmed two weeks after, he was appointed the substantive governor, again by radio announcement” (p.250). His appointment coincided with the 20th anniversary of the Bank’s establishment.

Diminutive in stature but stood ten feet tall when it comes to personal courage and fearlessness in speaking truth to power, the author writes (p.247) about Ashiagbor as: “Few governors spoke angrily to powerful politicians as Ashiagbor did and got away with it...”

Governor Dr Amon Nikoi’s tenure under “Child of Labadi and Equity of a Public Policy Consul” is his key conception and establishment of rural and community banks with his wife Gloria. This was to give the rural and urban poor access to modern banking services. He also envisaged these as instruments for (p .221) “mobilization of savings into agricultural development and cottage industries which had been two major preoccupations. The first one was established in 1976. And now all regions and districts of Ghana boast of rural and community banks. “

The tenure of Dr G K Agama, the longest-serving governor witnessed two major institutional developments: the establishment of the Banking College and other infrastructure and the appointment of the first woman Deputy Governor, Mrs Theresa Owusu. It will take over three decades for a second woman, Mrs Elsie Addo Awadzi to follow in her footsteps.  

Ideology, The Bank and the IMF

The second perspective is to view economic development through our revolving-door relationship with the IMF.  It is recounted in encyclopedic detail in this book: 16 engagements of bail-out programmes for debt relief, debt cancellation and restructuring and adjustment programmes. They read like the medical history of a hypochondriac. The policy burden and sacrifices from these programmes are endured by the poor people of Ghana.  And our persistent and recurrent economic mismanagement are responsible for our inevitable resort to the Fund. These as set out in anodyne acronyms belie the pain they inflict on the poor.

The tenure of Dr Kwesi Botchway, covered some very difficult times. He was a great strategist and a social engineer. Paradoxically it was the revolutionaries, Rawlings and Botchway who focused on cutting the umbilical cords of the economy from its socialist moorings from the first Republic. With the exchange rate jinx and then small gradual periodic adjustments, they created the forex bureau to tame the parallel market. The same people who had flogged and jailed Ghanaians for selling above control prices now prepared the foundation for a market economy.

The third perspective is the critically important collaborative or competitive relationship between ministers of finance and governors. And the fact that two governors also came to serve as ministers of finance evidence this tricky relationship; rivalry relationship between JH Mensah and Frimpong-Ansah was not necessarily on economic policy.

Even the more collaborative relationship between Paul Acquah and Yaw Osafo-Maafo had a few moments of anxiety whenever the governor had discussions with the presidency with the minister fearful of a potential policy ambush.

The Addison Team

Ivor has a knack as a chronicler of minute but interesting details. He recounts that Dr Mahamudu Bawumia became deputy governor at the age of 39; the same age as the first English deputy governor in 1957 and points out rightly the importance of having certain under-represented groups such as women in the decision-making chain.

A few points that need clarification as the Ghana patois goes. Why is Governor Dr Kofi Wampah characterized as a career insider when appointed governor? He had been seconded to WAMI and returned as Ivor himself chronicles. Why do Governors Adomakoh, Frimpong-Ansah and Ashiagbor, recruited into the bank as permanent employees and appointed governors, not qualify as Insider appointments?  Why is Governor Paa Kwesi Amissah-Arthur, our first Governor to transition to the vice-Presidency of the Republic, characterized as a socialist and from the ivory tower? 

The book ends with the new orthodoxy and a way of doing business. One is invited to go through this book to figure out the mentoring relationship between the Acquah and Addison and his team.

Governor Addison leads in a very difficult and challenging policy decision-making terrain and like the author’s metaphor of the chrysalis of a butterfly, is distorted by “the ugly noises” of partisan politics. The noise is made more deafening by the amplifying megaphone of social media. How they cope and maintain operational autonomy and technical competence will alter the nature and character of the bank for years. We are at a historic and potentially tipping point moment. The coming out of Ivor’s book will be a source of encouragement and provide a map and a searchlight to guide their path forward.

The book is not only to be read and put aside. It is to serve as a major source of reference for researchers, students and others in academia for all manner of studies in the humanities. And also, as a policy manual for those charged with the management of the political economy of Ghana and other developing countries.