Economic Analysts schools BoG

Ghana Growth and Development Platform (GGDP), a group of economic analysts, have appealed to the Central Bank to reverse distortions caused by its recent directives.

The platform, in a statement issued in Accra and signed by Kwamena Essilfie Adjaye, its interim chairman, lauded the Central Bank for making certain revisions recently in its foreign exchange accounts and foreign currency account rules.

“The BoG has shown that it has taken note, among others, of the recommendations made in ‘The Depreciating Cedi and Bank of Ghana Measures,’ the first working paper of the Ghana Growth and Development Platform (GGDP).

The GGDP, however, appealed to the BoG to implement other recommendations it suggested.

These include the removal of the limit of $10,000 on transactions in forex bureaux; removal of the limit of $50,000 on the electronic cards of importers with accounting to the bank that issues the card and all amounts used; allowing transfers from FEA to FCA provided it is the same account holder; and allowing offshore foreign exchange deals by resident companies and banks, as long as export proceeds are lodged in Ghanaian banks.

It also proposed that service providers should be allowed to decide when and what percentage of foreign currency payments in FEA should be converted into cedis.

“Furthermore, to restore lost confidence in the banking system and to address the depreciation of the Cedi effectively and slow down the practice of dollarization, the BoG should take immediate steps to increase the supply of foreign exchange and encourage use of the banking system.”

It further recommended that banks should encourage resident Ghanaians who have FEA and FCA to continue operating them.

GGDP said all export foreign exchange earnings must first be deposited into Ghanaian banks.

It noted that the retention agreements with mining companies must be reviewed accordingly.

“Year in, year out, there are export orders with exporters that cannot be filled largely because of lack of pre-export finance. A considerable amount of export revenue can be earned if these exports could be made. To address this problem, the BoG and Government should encourage and support banks, the Export Development and Agricultural Investment Fund, the Ghana Export Promotion Authority, and Export Finance Company to provide pre-export finance and to do so on time in line with the export schedule in the export contracts.”