A policy analyst at the Trades Union Congress (TUC) has urged the Bank of Ghana to find an ingenious way to compel commercial banks to reduce their interest rates as inflation and the prime rates come down. Mr. Kwabena Nyarko Otoo said the central bank is using a kind of moral suasion which is not likely to force banks to slash their lending rates. The analyst said this in an interview with Kwaku Sakyi, host of the Front Page on Joy FM. The central bank is currently targeting disinflationary as well as low policy rate regime which is working well, he said. The BoG policy rate currently stands at 16 percent whilst inflation is at 14.8 percent and continues to drop. Mr Otoo said it is worrying the situation where although inflation and prime rate figures have been on the downward spiral, lending rates remain high. The average lending rate charged by commercial banks in the country stands at 30 percent, a situation which is straining borrowing by industry. Although the Association of Ghana Industries (AGI) has pressed on government to take action, little seems to have been achieved. Central Bank Governor Amissah-Arthur says the bank can only “persuade” the commercial banks to slash interests on loans and not compel them to do so. The AGI and other labour organisations have suggested that BoG orders the banks to do so. “I find it very difficult to understand the whole bureaucracy called the Bank of Ghana. Singularly, it is focused on inflation. “We need to look at the macro-economy, for example, with respect to interest rates. If inflation is coming down, the Bank of Ghana prime rate is coming down why people are still borrowing at 31 percent interest rates. “You don’t throw everybody and every situation in the jungle of the market; thinking that the market situation will be better. It has never been better for us as a country and that the state needs to intervene strategically in some areas of our economy,” he indicated. A research fellow at the Institute for Statistical, Social and Economic Research (ISSER), Dr Dr Charles Ackah said the president must translate plans to industrialise from mere rhetoric to action. He said the President must, consistent with his state of the nation address promise, ensure that the industries are set up on the back of the country’s nascent oil find. President Mills at Thursday’s State of the Nation address said the National Democratic Congress (NDC) government is “laying the foundation for an integrated aluminium industry based on bauxite; a petrol-chemical industry based on salt and natural gas; a fertilizer industry to give impetus to agro development; a salt-based industrial chemical industry for caustic soda; and allied consumer products and exports based on oil and gas.” Dr Ackah said although agriculture is a very important component in the development of the nation, the government must ensure an industrialisation regime as the country starts to drill oil. Listen to excerpts of the comments by Mr Otoo and Dr Ackah Story by Fiifi Koomson/Myjoyonline.com/Ghana