Foreign reserves at mercy of Eurobond

Dr. Kofi Wampah, Governor of the Bank of Ghana (BOG) has disclosed that government is relying on the recently issued Eurobond and the cocoa syndicated loan to boost the country’s international reserves.

Speaking at the close of the Monetary Policy Committee (MPC) meeting in Accra, he said Ghana’s foreign reserves decreased to US$4.9 billion from a stock position of US$5.3 billion at the end of December 2012.

“It is expected that proceeds from the cocoa loan syndication and the Eurobond issue amounting to a total of almost $2 billion during the second half of the year would shore up the international reserves and further calm pressures in the foreign exchange markets,” he said.

Dr. Wampah said for the first half of the year, trade deficit marginally improved to US$1.2 billion from US$1.3 billion in 2012 on account of a slow-down of both exports and imports. He said merchandise exports recorded US$7.5 billion declining by 0.8 percent in 2013 while imports declined by 2.6 percent to US$8.6 billion, reflecting in both oil and non-oil imports.

Dr. Wampah said export earnings from gold and cocoa beans were estimated at US$2.7 billion and US$1.2 billion respectively compared to US$3.2 billion and US$1.6 billion in 2012 due to lower prices and volumes. He said oil exports, however, increased by 47.7 percent in 2013 to US$2.0 billion as a result of increased production by the Jubilee Partners.

Dr. Wampah said the improvement in energy supply and increased oil production are expected to support growth. He added that private inward transfers received through the banking system from January to June 2013 declined by 6.4 percent on a year-on-year basis to US$8.3 billion.

“Of the total transfers, US$928.4 million accrued to individuals compared to US$908.7 million in the same period of 2012.”