Stability, growing confidence are hallmarks of economy -JAK

Accra, Feb. 3, GNA - "Stability and growing confidence are hallmarks of Ghana's economy," President John Agyekum Kufuor noted on Thursday.

The economy could, therefore, provide the needed support for Government's policies and programmes, he said.

"I am happy to be able to state with reasonable confidence that, even though, Ghana's economy is not as yet in the league of the 'Asian Tigers', stability and growing confidence are now its hallmarks," he said in his first State of the Nation Address of his second term to Parliament in Accra.

President Kufuor said currently, there were positive economic indicators such as declining inflation at 11.8 per cent, lending interest rate of 26 per cent and a stabilising cedi.

He said significantly, the GDP growth rate, which was projected at 5.2 per cent at the close of last year, had exceeded all expectation and achieved a rate of 5.8 per cent.

"For the first time since the liberalisation of the foreign exchange market in 1990, the country has registered the highest gross international reserve cover of four months of import cover.

"These developments are of great interest to both local and foreign investors."

President Kufuor said confidence was steadily building up in the capital market as the Ghana Stock Exchange (GSE) registered impressive performances.

The GSE has continued to be among the highest performing Exchanges on the African Continent, with the All-Share Index, the main benchmark, recording a growth of 91.3 per cent at the close of 2004.

President Kufuor referred to a Reverend Minister, who urged his congregation to start investing on the GSE saying his reaction was, "there goes a smart preacher concerned not only about the spiritual development of his congregation, but also about their financial and material well-being."

The President promised that to sustain the macro-economic gains, the Government would continue to maintain strict financial discipline in monetary policy, which was aimed at achieving a single digit inflation, to make the economy stronger and planning easier.

He said more impetus would be put into revenue mobilisation to be able to reduce Government's domestic borrowing and make credit available to local investors.

President Kufuor said the Government would also continue to ensure the stability of the cedi to support commerce and investment.

He noted the many success stories of companies in the export processing zone saying that there had been very promising developments within the sector, which were attracting world leaders like AngloGold-Ashanti and Newmont Company, both in gold mining and ALCOA in aluminium.

"The mere presence of these great companies here is making an important statement to the world. If Ghana stays this course, the nation will see a great industrial take-off within the next five years," President Kufuor said.

On tourism, President Kufuor noted that tourism was one area for the private sector to invest in if the nation was to look beyond the obvious.

He said the Government's policy was to develop the country's tourism potential and make Ghana the preferred tourist destination in the West Africa Sub-Region.

"We must exploit our historical relics and the high reputation the nation enjoys internationally for hospitality, peace and stability." President Kufuor noted that Ghana's potential in eco-tourism remained largely unexplored and said the Government intended to partner the private sector to fully take advantage of "this untapped gold mine".