The Ministry of Trades and Industry (MOTI) says it has not "directed" banks to lower interest rates as misreported by some news media.

According to the Ministry headed by Kwow Spio-Garbrah, it has only appealed to banks in the country to reconsider their interest rates.

"More importantly, MOTI is aware that interest rates are determined by a wide range of variables", said the Ministry in a statement to clarify the matter.

The Ministry said it has begun discussions with the Central Bank and other stakeholders to help adjust the rates.

Read below the entire statement from the Ministry:

The Ministry of Trade and Industry (MOTI) has taken note of some misunderstanding and misrepresentation regarding the comments by the Minister aimed at seeking a reduction in loan reducing interest rates in Ghana.

Among some of this misreporting as carried out by some news portals that  the Minister had “directed” the Banks to lower their interest rates. The Minister, Dr. EkwowSpio-Garbrah did not direct the Banks but merely appealed to them.

More importantly, MOTI is aware that interest rates are determined by a wide range of variables.

These include the monetary policy of the Bank of Ghana, the cost   international credit, the domestic inflation rate, the borrowing practices of government, the demand and supply of domestic capital, the cost structure and profit margins of financial institutions, including the commercial banks, as well as the shareholder expectations.

Dr. Spio-Garbrah’s view of the war on interest rates is that it must be a collective war involving all stakeholders; central governments; the Bank of Ghana (BoG); financial institutions especially commercial banks; the foreign correspondents of local banks; borrowers and consumers; economic policy analysts; and even our development partners.

The Minister of Trade and Industry intends to invite key stakeholders to a Round Table discussion in the next few weeks to enable a consensus to be reached on steps that could be taken in the short, medium and long term to reduce lending rates and to improve savings rates.

The hard facts are that manufacturers and private sectors cannot survive and grow on Ghana’s permanently high interest rate structure, especially at a time when global average interest rates are very low between 0-5% in most advanced countries.

If Ghana’s private sector is to prosper and grow, interest rates must come down and all stakeholders have a responsibility to work towards that objective. This is not a time for blame –gaming but for a collective effort towards a nationally desirable goal

As a former senior official of both the World Bank Group and the African Development Bank, and a former mortgage banker in the USA, Dr. Spio-Garbrah has some understanding of interest rates and is making it a high priority national agenda item.

He fully recognizes the statutory role of Bank of Ghana (BoG) in determining Monetary Policy for the country and is aware of the other forces keeping the interest rates high.

The Ministry of Trade and Industry (MOTI) looks forward to all stakeholders becoming partners in this agenda to lower interest rates. This is especially to support industries, manufacturers, businesses and ordinary Ghanaian consumers, and promote a rapid industrialization and expansion of the private sector to absorb the numerous youth who are unemployed.

MOTI has taken note of the many calls by renowned economists like Mr. Kwame EssilfieAdjaye who agree that lending rates must come down.

Mr. Adjaye for example, has in a story which appeared in Graphic Business of Tuesday, November 18th, 2014 criticized the model used by the Bank of Ghana (BoG) in determining its rates.