New Patriotic Party (NPP) Member of Parliament for Ofoase-Ayirebi, Kojo Oppong-Nkrumah, has rubbished claims that Akufo-Addo administration’s maiden budget statement did not have plans to tackle the depreciating Cedi. He asserted that, the government did indeed proposed clear policies, anchored in fiscal discipline, to tackle the depreciation of the Cedi, contrary to the opinion of some critics.
The cedi commenced 2017 at GHc 4.2 on the interbank foreign exchange market, but figures from the Bank of Ghana show that the cedi depreciated by about 5.4 percent between January and February 2017 on the interbank forex exchange market, and as much as 6.72 percent in the same period across forex bureaus.
Pressure on Cedi at year’s turn Not to make light of the situation, Mr. Oppong-Nkrumah, in an interview with Citi News‘ Duke Mensah Opoku, noted that, per the Bank of Ghana’s currency monitoring report from 2000 to 2016, the Cedi experiences an average depreciation of about 5 percent indicating pressure on the Cedi at the beginning of the year. “There is pressure on the Cedi at this time of the onset of the year, which stems from foreign companies mobilizing dollars to repatriate abroad coupled with people mobilizing up dollars for importation, he explained.
Policies will keep foreign exchange inward Whilst noting that the situation with the Cedi was nothing extraordinary, he stressed that government had outlined clear policies to alleviate the situation. For one, he said government plans to put in place policies “that will strengthen private inward remittance flows which will develop financial products that will encourage remittance flows into investments.” “What that means is that, government is putting in place measures to make it attractive for people who otherwise would not bring their currency ordinarily into Ghana, to bring their currency into Ghana,” the MP explained.
“We are also looking at reducing the foreign exchange outflows with respect to trade in services such as freight and insurance expenses on imported goods, because very often, people have to send dollars abroad as part of services associated with imports. We are looking at taking these ones away so that people don’t have to repatriate some of those monies abroad.”
“So it is not true that the budget doesn’t say anything about the Cedi or that there are no plans. We have clear policy outlines and there is work being done. My comment on the Floor of the House has been that, for our own political exigencies, we shouldn’t send panic into the system,” Mr. Oppong Nkrumah stated.
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