Category: Finance

Accra, Professor Kwesi Botchway, a former Minister of Finance, has reiterated the importance of collaboration among actors in Ghana’s political space during the formulation and implementation of national projects.

He said accelerated development required political space built through consensus across party lines to enable governments to take decisions and make policies for the benefit of all.

Prof Botchway said this in his presentation at the Second Edition of the “DC Happy Hour” dialogue series in Accra on the theme: “Consolidating Ghana’s Democracy for Accelerated National Development”.

It was organised by the Development Challenge (DC), a multi-issue public policy think-tank that aims to bridge the gap between intellectuals, researchers, politicians and policy makers by serving as laboratory for innovation thinking.

Prof Botchway said an effective collaboration would enable governments in power to go about their business of governance without looking over their shoulders and worrying that perhaps the opposition would take political advantage of the fallouts that there might be.

Touching on the correlation between democracy, its effectiveness, consolidation, and accelerated development, Prof Botchway called for unbiased and effective key state institutions to ensure stability of the political environment.

“The consolidation of our democracies is important to provide these assurances and to eliminate or prevent perceptions that lead to so much frustrations and its consequences,” he said.

Source: Ghana News Agency

Accra, Alhaji Collins Dauda, a former Minister of Works and Housing and four others, have been charged for misapplication of funds in relation to the 5,000 unit Saglemi Housing project.

Alhaji Dauda is said to have “intentionally misapplied” $200,000,000 belonging to the Government of Ghana.

He is also charged for “wilfully causing financial loss” to the Republic.

Four others: Kwaku Agyeman-Mensah, also a former Works and Housing Minister during the NDC administration, Alhaji Ziblim Yakubu, a former Chief Director at the Works and Housing Ministry, Andrew Clocanas, the Executive Chairman of Construtora OAS Ghana Limited and Nouvi Tetteh Angelo, will face an Accra High Court with the former Minister over the charges.

Source: Ghana News Agency

Accra, – Vice President Dr Mahamudu Bawumia says African economies need digital currencies backed by Central Banks to give credibility to transactions.

“Digitization and the advent of digital currencies is something that is definitely coming. We are facing it and I am very, very happy that the Central Bank of Ghana is beginning to pilot digital currency and I think it will ultimately be the way to go for Africa.

“That, we will adopt, or we should end up trying to adopt a digital currency.

But I think that a digital currency that is backed by the central banks; that gives a lot of credibility to transactions and I think this is where we should be heading and the Bank of Ghana is leading the way and I expect other central banks to come forward with this in the future. It is the way to go”.

Vice-President Bawumia made the remarks when responding to a question on the readiness of the continent for an African digital currency, especially with the presence of the Africa Continental Free Trade Area (AfCFTA) at the Fifth Ghana International Trade and Finance Conference held in Accra.

The Central Bank-backed digital currency, which would be known as ‘e-cedi’ would allow households and businesses to directly make payments using electronic money issued by the Central Bank.

Blockchain-based Central Bank Digital Currency is an advanced, secure form of regulated national digital currency built on advanced blockchain technology and authorised by the Central Bank.

It has one-to-one exchange rate with fiat money that allows for the gradual migration towards central bank digital currency and also maintains adaptability with multifold strategies by the central bank.

The Vice-President said a digital currency that was backed by the Central Bank gives a lot of credibility to transactions, saying; “I think that is where we should be heading and the Bank of Ghana is leading the way and I expect other Central Banks in Africa to come forward with this in the future”.

The conference was attended physically and virtually by some senior officials of African Central Banks, the African Union, the Diplomatic Community, members of West African Monetary Institute, and key stakeholders of AfCFTA.

The event was held on the theme: “Facilitating Trade and Trade-Finance in AfCFTA; The Role of the Financial Services Sector”.

Dr Bawumia said Intra-African trade had created the need to establish a Single Central Payment platform on the African continent where financial system operators could carry out all cross-border payments smoothly.

To that end, the Vice-President believed that the Pan African Payment and Settlement System (PAPSS)- a central payment and collection infrastructure- would allow businesses on the continent to clear and settle transactions in their local currencies without depending on third-party currencies.

He said it would also provide an alternative to the current high-cost and long correspondent banking relationships by facilitating trade and other economic activities across the continent through a single, low-cost, and risk-controlled payment clearing and settlement system.

Vice-President Bawumia noted that digitisation had become one of the most consequential policies of the President Akufo-Addo’s government and pivotal towards increasing economic activities, macroeconomic stability, and growth.

In that vein, a robust and resilient financial system would provide an impetus for productive investments, expand opportunities for jobs and wealth creation.

“As you may recall, in a bid to improve liquidity and strengthen the banking sector, the Bank of Ghana implemented a new prudential regulatory framework.

“The banking sector clean-up was aimed at promoting a financially stable banking sector.

“Concurrently, digitization has also become one of the most consequential policies of the Nana Akufo-Addo government. When the scourge of the COVID-19 pandemic hit and forced many economies into partial and total lockdowns, it reinforced the need to pursue digitization,” Dr Bawumia emphasised.

He stated that mobile banking was proving to be a more convenient alternative to traditional banking channels as several routine banking and money transactions were now executed through mobile phones and electronic payment systems.

“Indeed, one has to recognise that for the financial services sector to play its role, there must be financial inclusion.

“The implementation of Mobile Money Interoperability in Ghana has shown that more people can be financially included, and this needs to be rolled out across Africa to ensure the growth of the AfCFTA vision,” he added.

To leverage digital technologies and digitized data, he said, the Central Bank had rolled out a couple of systems through its Ghana Interbank Payment and Settlement Systems (GHIPSS).

They include the e-zwich, Gh-Link, Mobile Money Interoperability, and QR Code, and making sure that the underlying payment system runs smoothly is the least we should expect of the financial system if we are to realize the vision of the continental free trade.

He stressed that since payments were at the heart of the day-to-day operations of a free trade system, negative spillover effects could be serious if something goes wrong.

Therefore, in 2019, the Government introduced the Payment Systems and Services Act, 2019 (Act 987), under the supervision of the Bank of Ghana, to consolidate the laws relating to payment systems, payment services, and regulate institutions in the electronic money business.

Source: Ghana News Agency

Accra, – Government is building a robust framework to expand domestic revenue mobilisation with a focus on compliance and enforcement nationwide.

Mr Ken Ofori-Atta, the Minister of Finance, said Government has, therefore, established the Revenue Assurance and Compliance Enforcement (RACE) towards that agenda.

The Minister said this when he presented the Mid-year fiscal policy review of the budget statement and economic policy of the government to Parliament on Thursday.

The aim of RACE is to identify and eliminate revenue leakages in areas such as petroleum bunkering, gold and minerals export, port operations, transit goods, warehousing, border controls and free zones operations, among others.

Mr Ofori-Atta said with every crisis, the need to re-structure and diversify the economy becomes imperative, and said that was what the government was focusing on.

He said the recent experience of the COVID-19 pandemic, with its disruptive impact on global and regional value chains had once again highlighted the need to build a transformed Ghana Beyond Aid.

The Minister said it was for that reason that in November 2020, Government launched the audacious GH¢100 billion Ghana COVID-19 Alleviation and Revitalization of Enterprises Support (Ghana CARES) ‘Obaatanpa’ Programme.

He said the first phase of the programme also known as the “Stabilisation Phase” was implemented between July – December 2020 and it alleviated the immediate impact of COVID-19 on the economy and restored normalcy in the lives and livelihoods of Ghanaians.

Mr Ofori-Atta said the programme substantially subsidised water and electricity costs; provided hot meals and food packages distributed to vulnerable and underprivileged persons and increased allocation for the CAP-Business Support Scheme to support MSMEs.

It also had GH¢2 billion Guarantee Scheme established to support large businesses, established skills training programmes in collaboration with social partners and FBOs; and passed the urgent legislation to enforce COVID-19 safety protocols.

Source: Ghana News Agency

Afrisipakrom (A/R), – The leadership of YASTA Fish Farmers Association in the Tono North Municipality, Ahafo Region, have expressed worry that the emergence of Newmont Ghana Gold Limited (NGGL) in that area is a great threat to their sustainable socio-economic livelihoods.

According to Mr. Ahmed Saiid Addai, Chairman of the Association with a membership strength of 200, comprising mostly of both male/female youth across Yamfo, Afrisipakrom, Susuanso Terchire, and Adrobaa (YASTA), they could harvest more than 90 tons of cat fish and tilapia every month.

“But because of NGGL’s claim of moratorium placement on our lands since 2017 and subsequent refusal to pay us our due and adequate compensation packages, we are heading towards losing our means of survival”.

Speaking to the Ghana News Agency (GNA) in an interview at Afrisipakrom, Mr. Addai bemoaned “Newmont is rather coming to end our businesses and greatly do us more harm than good”.

This, he explained was due to the real, reasonable, and appropriate price in relation to the life expectancy of their landed properties, particularly economic trees such as cocoa, cashew, mango, oil palm and others like teak and ‘Odum’ for timber purposes were not offered by the company in the negotiation with them.

“This situation is a great threat to our economic stability and thus social lives because it will be become extremely difficult to afford even quality education for our children and wards”.

Mr. Addai demanded, “discussion to keep our fish farming businesses running must clearly be concluded by replacing our fish ponds with new ones before resettlement so that we wouldn’t go poor after sacrificing our properties for the mining company”.

On his part, Mr. John Eric Bediako, the Association’s Secretary expressed worry that the YASTA fish farming business had created more than 600 direct and 1000 indirect jobs to people in those five communities.

The farmers (fish pond owners) were excluded from the 1,600 employees. Mr. Bediako said, but NGGL has not considered it necessary to engage the leadership of the Association to disclose plans of an arrangement pertaining to the job security of those employees, he added.

Mr. Bediako, therefore, announced their appeal “to our traditional authorities, Dr., Freda Prempeh, the Member of Parliament, Mr. Samuel Abu Jinapor, the Minister for Lands and Natural Resources and President Nana Addo Dankwa Akufo-Addo for their immediate intervention so that our required compensation packages will be paid with further arrangements for us to remain in business”.

He alleged the NGGL Ahafo North Mine would only employ a total of 1800 workers, about 1,300 casual laborers, and the remaining number as permanent staff from the five communities, complaining that clearly indicated only a few people would get the opportunity of being employed.

That implied “we the fish farmers will lose our livelihoods, but we must not be left unemployed”, Mr. Bediako stressed.

In a related interview, Mr. Sampson Owusu, the 2020 Ahafo Regional Best Fish Farmer requested for cemented ponds with dams for frequent water flow to avoid drought to sustain their fish farming businesses if they would be resettled from the company’s concessional areas.

Source: Ghana News Agency

Finance Minister, Ken Ofori-Atta, says the cedi has been relatively stable against major trading currencies this year.

He said this when he presented the 2021 mid-year budget review in Parliament on Thursday, July 29, 2021.

“The cedi has been relatively stable in the past four years and maintained its stability even in this pandemic year. For the first time in the Fourth Republic, the exchange rate did not see a spike after an election year,” he said.

The depreciation of the cedi against major trading currencies, especially the dollar, has over the years dominated public discourse.

The local currency had remained fairly stable in the first two quarters of 2021, experiencing a depreciation of less than one percent against the US Dollar between January and June.

Fundamentally, the structure of Ghana’s economy, which is largely import-driven, has been largely blamed for the periodic struggles of the local currency against other currencies.

Foreign investment inflows helped cedi’s stability in the 1st half of 2021 – Economist

Economist, Courage Martey, had also acknowledged the cedi’s performance so far this year.

He attributed this to foreign investment inflows the country has enjoyed in the last few months.

“The cedi actually enjoyed support from foreign investment inflows, especially in the first quarter of this year. We also didn’t experience strong demand from corporate institutions and multinationals, so the cedi found strong support from the supply, which was not absorbed by demand.”

“In the second quarter, we saw a renewed increase in corporate demand. The demand for forex to repatriate this profit actually increased the demand pressure on the market. Due to the Bank of Ghana’s intervention, even though the demand was increasing, we saw it happening in a very controlled space. However, we ended the quarter by overturning all the gains we made in the first quarter so that at the end of the first half of this year, the cedi appears to be relatively stable,” he said in a Citi News interview.

Source: Modern Ghana

Accra, – Dr Cassiel Ato Forson, Ranking Member on the Finance Committee has described the Mid-Year Budget Review presented by Finance Minister, Ken Ofori-Atta as hopeless with nothing in it for Ghanaians.

According to him, the Ghanaian economy in the current situation is in a bad shape, and urged the Government to take what he called “the right decisions” and actions.

Dr Forson made the remark in reaction to government’s Mid-Year Fiscal Policy Review of the Budget Statement and Economic Policy of Government for the 2021 Financial Year, presented to Parliament by the Finance Minister, Ken Ofori-Atta.

Dr Forson also stated that almost every single revenue item presented Mid-Year Budget is under performing.

He cited for example that government revenue for the first six months in 2021 under performed by about GH¢2 billion.

Also, instead of the government deciding to revise the revenue target it rather decided to maintain it, the Ranking Member said, and indicated that within the first six months of 2021 instead of Government spending GH¢2 billion on Goods and Services, it ended up spending GH¢4.5 billion.

Dr Forson said instead of the government ensuring that the country’s debt becomes sustainable; it rather decided to go back to the bond market to borrow more money.

“In fact, I have a worry…my worry is that, in as much as this government has decided to borrow, they are borrowing to consume, and apart from that all the revenue items are actually coming down,” the Ranking Member, a former Deputy Minister of Finance, under former President John Mahama’s Administration said.

He challenged the figures presented in the Mid-Year Budget, saying they were “cosmetic”, adding that, “every single target for this year would miss the fiscal mark.”

Mr Isaac Adongo, Deputy Ranking Member of the Finance Committee, also reacting, said the Government failed to come out boldly with revenue measures for the country to get out of the debt trap.

Another major concern of the Minority was the Government’s budget to spend 91 percent of its revenue on interest payments on loans, which Mr Adongo said was not sustainable.

Mr Kwaku Agyeman Kwarteng, former Deputy Minister for Finance and Chairman of the Finance Committee, hailed the Government for maintaining all the social intervention programmes, introducing no new taxes, and not requesting for additional money from the Mid-Year Budget.

He said with the current macro-economic indicators stabilizing, there was likely to be an improvement in the growth of the economy.

Mr Kwarteng said despite the impact of the COVID-19 pandemic on many countries who were struggling, Ghana’s economic recovery has started very well.

“I expect that the economy continues to grow along that path,” the Finance Committee Chairman said.

Dr Stephen Amoah, Member of Parliament (MP) Nhyiaso, lauded the Government for managing the country’s debt level better to ensure fiscal consolidation.

He said former President Mahama’s Administration introduced 10 different taxes, but when President Akufo-Addo assumed office, he scraped 15 different taxes and introduced less than 10 taxes.

Dr Amoah said the Minority’s insistence that the Government should come out boldly with revenue measures to address the country’s debt problem failed to come out with an alternative policy for the government.

Source: Ghana News Agency

Accra, – The Finance Minister, Mr Ken Ofori-Atta says the COVID-19 pandemic has exerted seriously on the economy, creating job losses and exacerbating the unemployment problem, particularly among the youth.

“As such, Government is ready with a comprehensive programme to tackle this intractable problem. The goal is to create employment opportunities for a million of our young people over the next two and a half years,” the Minister assured.

Mr Ofori-Atta reading the mid-year budget review said the Government had competently managed the COVID-19 situation, and made Ghana’s economy outperformed its peers, and recovering faster.

“After recording negative growth in the second and third quarters of 2020, the economy rebounded strongly in the last quarter of the year, continuing well into the first quarter of 2021,” Mr Ofori-Atta added.

He said reports from the Ghana Statistical Service indicate that the overall GDP growth for the first quarter of 2021 was 3.1 percent and “the growth was even better excluding oil at 4.6 percent.

“The Bank of Ghana Composite Index of Economic Activity (CIEA) attests to the strong growth recovery, with the index growing at 33.1 percent at the end of May 2021 compared to a contraction of 10.23 percent at the end of May 2020.

On inflation, the Minister said, Ghana is witnessing one of the lowest numbers on record in about two years.

“Inflation, which, at the height of the pandemic, hovered around 11.8 percent, dropped to 7.5 percent in May 2021 before inching up slightly to 7.8 percent in June.

Mr Ofori Atta said the Central Bank, the Bank of Ghana “will continue to implement appropriate monetary policy to maintain inflation rate within the target of 8 -2 percent.

According to the Minister, the cedi has been relatively stable in the past four years, and maintained its stability even in this pandemic year.

Also, he said for the first time in the Fourth Republic, the exchange rate did not see a spike after an election year, and cumulatively, from the beginning of the year to date, the exchange rate has depreciated by 0.6 percent against the US Dollar and appreciating by 3.6 percent against the Euro.

“This stability is expected to continue as we move towards the close of the year,” the Minister indicated, and added that “the relatively strong performance of the external sector led to an increase in the reserves position to US$11.0 billion, equivalent to 5.0 months of imports, one of the highest on record.”

This, he said, compares well with a reserved position of US$9.2 billion, equivalent to 4.3 months imports cover, in the corresponding period last year.

The Minister gave thumbs up to the governing New Patriotic Party (NPP), for its management of the Ghanaian economy, saying,” Mr. Speaker, we are managing the finances of the country with discipline and competence.”

Source: Ghana News Agency