Stop Predicting Economic Disasters

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President Tells Doomsayers

President John Dramani Mahama, has lauded “wise Ghanaian politicians”, who are standing behind his Government at a time when the country was facing dire economic challenges.

Without mentioning names, the President wrote on his social media site, Facebook last Monday that these politicians “understand that the right attitude in such times is to assist the Government and stop predicting disasters.”

“Because in a democratic country such as ours, the government is the people’s government. It is your government”, the President’s post said in part.

He then ended by urging Ghanaians to unite even as the country faces “economic and political challenges”.

The President’s Facebook wall read: “I thank and salute the wise Ghanaian politicians who understand that the right attitude in such times is to assist the government and stop predicting disasters. Because, in a democratic country such as ours, the government is the people’s government. It is your government. And it does everything necessary to lead our country and to attain the development goals it has announced. A nation has to be united when facing any kind of political or economic challenges.”

Ghana’s currency, since January this year, has been consistently depreciating by more than four per cent against the major international currencies. In 2013, the local currency suffered 17 per cent depreciation.

Presently, the United States Dollar, which used to sell on the local foreign exchange market for Gh¢2.20 before December 2013, is now selling at Gh¢2.60 , while the British Pound, which used to be sold at about Gh¢3, is now selling at Gh¢4.20.

The euro and CFA are selling at Gh¢3.50 and Gh¢4.80 respectively.

The Bank of Ghana (BoG), has announced additional measures to shore up the cedi against the major foreign currencies.

As part of the measures, it has banned commercial banks and other financial houses from issuing cheques and cheque books on foreign exchange accounts and foreign currency accounts (FCA).

BoG, has also directed that no bank should grant a foreign currency-denominated loan or foreign currency-linked facility to a customer who is not a foreign exchange earner.

This has culminated in a national debate and consequently called for a crunch cabinet meeting on Monday.
Cabinet, on Monday, backed measures instituted by the BoG to control the depreciation of the cedi.

According to a statement issued by Information Minister Mahama Ayariga, cabinet has also endorsed the actions aimed at ending the dollarization of the economy and restore stability of the cedi.

Cabinet also raised concerns about the lack of clarity in some of the directives, especially with regard to foreign currency accounts and their impact on the operations of exporters and businesses.

“Cabinet remains committed to the implementation of a number of policies that would reduce import dependency, promote consumption of local produce, thereby, addressing the current account imbalance.”

It said, Cabinet has concluded an interaction with the Governor of the Bank of Ghana aimed at clarifying a number of concerns arising from the Bank’s recent announcement of measures to address the depreciation of the cedi.

Cabinet endorsed the actions to end the dollarization of the Ghanaian economy and ultimately restore the stability of the cedi, said in a statement signed by Minister for Information & Media Relations, Mahama Ayariga.

The meeting took note of recent developments in the global economy, especially exchange rate adjustments in emerging and frontier economies. It was observed that some emerging economies had fared far worse than Ghana.

Cabinet, however ,was concerned about the lack of clarity in some of the directives announced by the Bank of Ghana especially those aspects that affect the operations of foreign currency accounts and their impact on the operations of exporters and businesses in general.

In that regard the Bank of Ghana has agreed to address any ambiguities in the measures announced and provide more clarity.

Cabinet agreed on the need to support the Bank of Ghana in the implementation of the measures. It directed State agencies to fully support these efforts.

“Cabinet remains committed to the implementation of a number of policies that would reduce import dependency, promote consumption of local produce thereby addressing the current account imbalance”, it concluded.

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