Cedi fall: Expand export base – Terkper to government

Former Finance Minister Seth Terkper has said the most efficient way to stop the fall of the Cedi against international trading currencies is to expand the country's export base.

This is after Mr. Terkper had shot down suggestions of banning importation which is believed to have been the major cause of the Cedi's poor performance.

According to him, banning importation entirely may be best approach in dealing with the perennial fall of the local currency but Mr. Terkper was quick to add that such a move will come with dire consequences especially unfavorable reactions from blocs Ghana is a signatory too, hence not advisable.

The suggestion comes as the Cedi is beginning to see some gains after falling drastically against the dollar from February.

Some Ghanaians have blamed the fall on weak economic fundamentals despite the assurances from government.

Speaking to Francis Abban on the Morning Starr Wednesday, Mr. Terkper urged managers of the economy to be cautious with the gains being achieved with the currency because it could be a “temporary relief”.

“The hardest decision you have to take is to ban imports of things you produce locally, but we are members of global trade associations and you can’t do that out rightly,” he said.

On the oversubscription of the latest bond floated by the government, Mr. Terkper said the managers of the economy deserve some commendation for the feat.

“Some of the debt management policies are being sustained and I think that is good. Revenue flows are not coming in as much. Forex supply has become secondary and necessary. f we’ve had consistent forex inflow during the dry season, things would have been much better and we would have had some short term relieve”.

He also warned against the latest move by government to defer payment of interest on loans due.

“We are beginning to defer even payments of interests on some of the loans and bonds we are taking and that is not the best. If we continue in this way, we will experience roll over risks which is dangerous”.