Climate change now threatens economic stability – BoG Governor

Climate change is no longer a distant environmental concern but a direct threat to Ghana’s financial stability, the Governor of the Bank of Ghana (BoG), Dr. Johnson Pandit Asiama, has warned.

Addressing the launch of Ghana’s Sustainable Finance Roadmap in Accra on Tuesday, Dr. Asiama said recent flooding across the country demonstrates how climate-related shocks are increasingly affecting the financial system through asset values, insurance claims and lending risks.

“A changing climate now bears directly on financial stability, as recent flooding across Ghana reminds us. Such risks do not stay in the environment; they travel into the financial system through the value of assets, the cost of claims, and the security of lending,” he said.

The Governor explained that the country’s financial regulatory framework must evolve to address emerging climate risks, stressing that traditional financial structures were not designed to respond to such challenges.

“The instruments and structures of the past were not built for them, and meeting them asks us to recalibrate how we supervise, how we price risk, and how we plan,” Dr. Asiama stated.

He cautioned that climate change and other sustainability challenges are already reshaping economies and financial markets, making decisive action unavoidable.

“It is now clear that climate change and other emerging sustainability challenges are no longer distant concerns. They are realities that increasingly shape our economies, our businesses, and our financial systems,” he said, adding that responding to these challenges “is not simply an option – it is a responsibility we owe to our nation and to generations yet to come.”

Dr. Asiama warned that failure to respond would expose Ghana’s financial system to greater risks.

“Ignoring these evolving risks would leave our financial system vulnerable. So, we have chosen a different path – one of foresight, innovation, and collaboration,” he noted.

The Governor said the Sustainable Finance Roadmap provides a coordinated framework for regulators to integrate environmental, social and governance standards, strengthen climate-related risk management and mobilise sustainable investment.

He added that the initiative is intended to position Ghana as a destination for climate and development finance while building a stronger and more resilient financial sector capable of supporting long-term economic growth.