Saving Cedi: Gov’t to tighten imports
Ghana’s Finance Minister, Mr Ken Ofori-Atta, has hinted at plans by the government to implement import reforms to help shore up the cedi.
The minister believes such a move will contribute to the reversal of the depreciation of the local currency in the import-dependent West African nation.
The cedi was trading at GHS5.6 to US$1 as of Friday, 15 March 2019.
This represents a depreciation of 13% from the beginning of the year.
Speaking to journalists after a meeting with state-owned enterprises (SOEs) on Friday, Mr Ofori-Atta said: “Truly, for us, as an import-dependent country, that has to change because that fundamentally then changes the whole issue of foreign exchange and that is why we are coming out with this comprehensive review of the ports, for starters…”
Mr Ofori-Atta added that the government will also invest in domestic production to boost the strength of the cedi.
The minister revealed that the government is also “beginning to look at the whole support of the One District-One District (1D1F) programme, agriculture, Planting for Food & Jobs, etc. So, we begin, really, to reduce this $2.4bn of imports that we have for food etc.”
Asked how the government can achieve its aim of sieving imports and equipping locals to meet the demand gap, the minister said the government is positive of the outcomes, considering the clean-up of the financial sector, adding that: “We are really confident that what we have done in the banking system” will help strengthen banks and financial institutions to provide adequate liquidity to support an industrialisation drive.
The government is also eyeing funds from Ghana Cocoa Board (COCOBOD) and the launch of the $3 billion Eurobond, in the coming weeks, as a stopgap measure for the weakening cedi.