|
Getting your Trinity Audio player ready...
|
The Deputy Trade Minister has said the government and Central Bank's
decision to pump 20million dollars a day of the country's reserves
into the economy has largely contributed to the stability of the cedi.
Kweku Ricketts Hagan was however quick to add that the measure is only
temporary and that government is taking medium to long term policies
to sustain the stability of the cedi.
After months of continued depreciation which negatively affected
economic activities in the country and the prices of goods and
services, the cedi has seen some appreciation over the last few days.
The cedi which was sold for some 4.3 cedis a dollar in June is now
selling between 3.2- 3.7 cedis to a dollar.
The appreciation has seen some mixed reaction as some Ghanaians are
complaining about the varying exchange rates being offered at some of
the forex bureaus.
Speaking on Joy FM's newsnight programme with Dzifa Bampoh, the Deputy
Trade Minister said theBank of Ghana has decided to mopup more cedi by
pumping more dollars into the economy.
"There is too much cedis, less dollars," he explained as cause of the
depreciation.
He conceded the strategy was unsustainable, pointing to a more
rigorous processes of salary rationalization, taking off subsidiesand
smart borrowing.
He ranked the Single Spine Salary Structure, cost of subsidies and
interest on loans as the major causes of the depreciation, stating the
government is working tirelessly to solving the challenges.
"The medium term solution is to check the deficits and other
macroeconomic stability issues," he noted.
Head of Research at Group Nduom, Sam Ampah believes the decision to
pump 20 million dollars of reserves into the economy is a good move.
He is anticipating that the cedi will continue to appreciate against
the major trading currencies but said the way to a sustainable
currency is for the country to change the structure of the economy.
He observed the country depended too much on imports, hoping more
value will be added to the country's raw materials to generate more
foreign exchange for the country.
Credit: Myjoyonline.com
