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Business News Tue, 11 Feb 2020

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Flashback: Government guilty of dollarisation of economy - Ayariga

A former Information Minister admitted that government pumped 20 million dollars into the economy to stabilise the local currency, Cedi.

The injection of the huge sum of money into the economy, Mahama Ayariga indicated six years ago, was as a result of the Central bank’s failure to enforce necessary directives to strengthen the cedi and prevent the currency from its frequent fall.

He also promised Ghanaians to be hopeful of a currency that will be stronger enough to compete with the major trading currencies.

In recent times, the cedi has appreciated against the US dollar, Euro and Pounds sterling in the first month of 2020.

The Bank of Ghana’s (BoG) latest Summary of Economic and Financial Data indicated that the cedi has in January 2020, appreciated 0.3 percent against the dollar, and made a 1.9 percent gain on the British pound, while it recorded a 2.3 percent appreciation against the Euro.

Read the full story originally published by XYZ.com below

Government of Ghana has conceded that it has also contributed to the dollarization of the economy.

It also stated that the phenomenon got entrenched as a result of the central bank’s failure to enforce necessary directives to stop it.

The Bank has injected 20 million dollars into critical sectors of the economy to salvage the cedi.

It has also announced a list of measures toward the same end.

A Cabinet meeting on Monday endorsed the Bank’s measures to halt the free fall of the cedi and the dollarization of the economy.

Information Minister Mahama Ayariga in an interview with host of Radio XYZ Breakfast Show disclosed that government is committed to ensuring that the economy recovers soon.

“On the side of government we also undertook to comply with all those directives because government itself is guilty of many of the inappropriate practices that the bank is complaining about”.

Hon. Ayariga added that “Government itself is charging for some of its services in dollars, government itself is transacting in dollars in certain respects, government itself is contracting loans and implementing projects in dollars and government is also not helping in some respects to enforce some of the regulations and they have become cultural and people think they are legitimate”.

Hon. Mahama Ayariga added that government would do everything possible to ensure that the cedi is stabilized soon.

Source: www.ghanaweb.com

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