Business News of 2014-01-31

Bank of Ghana releases 20m dollars to halt cedi's free fall

The Bank of Ghana has released 20 million dollars onto the market over the past two days to help halt the free fall in value of the local currency - cedi.

This follows complaints by some commercial banks that they do not have enough dollars to support the operations of businesses in the country.

This is the first time over the past week, that the regulator has released some dollars onto the market.

However, checks by Joy Business indicate the amount is yet to make the deserved impact on the operations of the commercial banks.

Some analyst say they do not expect the amount released to correct the situation immediately since the current challenge has to do with the structure of the economy which is import based.

They however believe enforcing the existing laws to punish those who quote and price their products in dollars in the country can help address the situation in the short term.

Following the recent amendments made to the foreign exchange laws, commercial banks are not allowed to import dollars on their own. They therefore have to depend solely on the Bank of Ghana for the supply of dollars.

In a related development, while the cedis depreciation has brought some untold hardship to some businesses and individuals that depended on dollars for their operations, Joy Business checks indicate that firms in the export business are making some good cash.

“Basically we are earning more from our export…we use cedis to buy our raw materials and then export our schools and we get dollars. This has increased our profit margin.”

Source: myjoyonline
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