Cedi will regain strength in weeks — Ofori-Atta

• Posted on March 14, 2019May 23, 2020
• by Ellsamwise King
• Comment

The Minister of Finance, Mr Ken Ofori-Atta, has given an assurance that the cedi will begin to appreciate against the major currencies within the next two weeks. “The reversal will occur and it is going to be pretty stable,” Mr Ofori-Atta stated.

He said a total of $4.6 billion would be injected into the system before the second quarter of the year.

Mr Ofori-Atta told journalists in Accra yesterday that the government was expecting about $900 million funding for the COCOBOD and an additional $750 million bridge financing intended to cover the government’s short-term expenses.

“Today as we speak, we launched our Eurobond, which would officially be close to $3 billion,” Mr Ofori-Atta announced.

Cedi not cheapest

Disagreeing with claims by some international news portals that the cedi was the cheapest currency on the continent, Mr Ofori-Atta said the economy was doing well despite the recent depreciation of the cedi.

For instance, he said inflation was currently in a single digit while growth stood at six per cent 

He said it was not healthy for Ghanaians to repeat the statement that the cedi was the cheapest on the continent, adding that “the truth of the matter is to look at the fundamentals.” 

The budget deficit, he explained, had gone down.

He said there was a similar shake up in the cedi until the government raised the $2.2 billion bond in 2017.

According to him, the strengthening of the US dollar last year also led to about eight per cent depreciation of the national currency.

He said the conclusion of the IMF programme had given some investors some discomfort but gave an assurance that the government was doing its best to stabilise the cedi.

Cedi Depreciation 

The cedi has depreciated by 8.5 per cent since January 2019.

Currency analysts are saying investors are withdrawing their money from the country, which was a cause for a slump in the value of the currency.

The other issue is a perception that the banking crisis had caused people to keep money from the banks.

Instead of investing in some instruments, people are buying dollars for keep. This increases demand.

Paperless System

Earlier, Mr Ofori-Atta answered questions on the floor of Parliament.

Answering a question posed by the Member of Parliament of Adaklu, Mr Kwame Governs Agbodza, on whether or not the paperless port system had increased the cost of doing business, Mr Ofori-Atta said it rather reduced the cost of doing business by 75 per cent.

Providing statistics to back his claim, Mr Ofori-Atta said his outfit, the Ghana Revenue Authority (GRA), the Ghana Ports and Harbours Authority (GPHA) and the Ghana Freight Forwarders Association conducted a comparative analysis on the cost of doing business in pre and post paperless regime at the port which showed that the components of doing business at the port had reduced from seven to three and thereby resulted in the reduction of doing business by 75 per cent.

Payment to GCB

Answering a question from the MP for Bolgatanga Central, Mr Isaac Adongo, on the amount the government had paid for the takeover of selected assets and liabilities of UT and Capital Banks, the finance minister said: “The Government of Ghana issued two separate bond certificates (A&B) with a face value of GH¢1,600,284,292.18 and GH¢2,201,280,634.00 and maturity dates of December 31, 2017 and December 31, 2027, respectively.”

MOMO Transactions 

He also told the House that the value of mobile money transactions had grown from GH¢594 million to GH¢2.2 billion over the past five years.

“This is a sector that is increasingly impacting the lives of our citizens positively and the government will work to ensure that fellow Ghanaians enjoy full benefits of this platform,” Mr Ofori-Atta indicated.