As debate continues over the government’s Ghana Accelerated National Reserves Accumulation Policy (GANRAP), Finance Professor at Andrews University in the United States of America, Prof. Williams Kwasi Peprah, is discouraging the framing of the issue as a zero-sum contest between building foreign reserves and creating jobs.
Prof. Peprah admits that there is a “classic trade-off” under the reserves programme; however, he was quick to add that the issue can be managed through careful sequencing and complementary policy design.
In an interaction with The High Street Journal on the debate generated by the new policy practically explained how it can achieve its reserve target of 15 months by 2028, without compromising job creation and welfare spending as feared by critics.
The Core Debate
Critics of GANRAP argue that prioritising reserve accumulation could divert resources from urgent, high-impact needs such as job creation, infrastructure, and poverty-reducing programmes.
For them, in a country where youth unemployment and cost-of-living pressures remain pressing concerns, the fear is that macroeconomic buffers may come at the expense of immediate welfare.
However, Prof. Peprah insists the debate is more nuanced. He acknowledges that jobs and direct poverty-reducing spending produce immediate welfare gains; however, on the other hand, reserve accumulation also produces macro-stability that protects jobs and growth indirectly.
To put it simply, one addresses today’s hardship; the other shields tomorrow’s economy.
“Jobs and direct poverty-reducing spending produce immediate welfare gains; reserves produce macro-stability that can protect jobs and growth indirectly (by avoiding currency collapses, sudden stops, or import shortages),” he told The High Street Journal.
Why Reserves Matter
Foreign reserves act as economic insurance. They help stabilise the currency during external shocks, prevent sudden import shortages, and cushion the country against capital flight or commodity price volatility.
Without adequate reserves, economies risk sharp currency depreciation, rising inflation, and emergency borrowing under difficult terms, outcomes that can wipe out jobs and undermine social spending far more severely than temporary fiscal restraint.
In practical terms, weak reserves can trigger a chain reaction: a falling currency makes imports expensive, inflation rises, businesses struggle, layoffs follow, and government revenue shrinks.
Reserves, he then says, are protective buffers against these threats.
Sequencing Is Key
Although Prof. Peprah admits that critics have a valid point if reserve accumulation comes at the direct expense of essential public investment or social protection, the impact is short-term.
“If reserves are accumulated at the expense of essential public investment or social protection, the short-term welfare losses are real, and critics have a strong case,” he suggests.
In such a scenario, the policy mix would be poorly calibrated, and public frustration would be understandable.
For the Finance Professor, his central argument is that Ghana does not need to choose between jobs and reserves, but must sequence its policies intelligently.
He explains that this means building reserves while maintaining fiscal discipline, protecting essential social programmes, and ensuring transparency in how reserve funds are managed.
Professor Peprah suggests, for example, that separating stabilisation funds from the general budget, setting clear governance rules, and maintaining prudent borrowing levels can allow reserve accumulation to coexist with employment-focused policies.
For him, the debate is not about the extremes, but balance. He believes that if the proper balance is created, the policies will complement each other and not compete.
In this sense, the reserves, he says, the reserves could be enablers of sustainable employment growth.
“If reserves are built while maintaining prudent fiscal space and clear rules (e.g., separate stabilization funds, transparent governance), then reserves can be a legitimate macro-insurance priority that supports sustainable job creation over the medium term. This suggests optimal policy mixes, not extremes,” he explained.
The Bottomline
The ongoing GANRAP debate reflects a broader development challenge of how to balance immediate needs with long-term resilience.
For Prof. Peprah, the issue is not whether reserves or jobs are more important; it is whether the government can design policies that deliver both in the right order.
If executed well, Ghana’s reserve strategy could strengthen the foundation upon which sustainable jobs and welfare programmes are built.
