Cedi fall renders 2019 budget useless – Minority

The Minority in parliament has said the free fall of the Ghana cedi vis-à-vis the dollar and other international currencies of trade, has rendered the 2019 budget, which was read by the Finance Minister in November 2018, useless, thus, called for a new fiscal statement that makes up for the anomaly in the value of the cedi...


The Minority in parliament has said the free fall of the Ghana cedi vis-à-vis the dollar and other international currencies of trade, has rendered the 2019 budget, which was read by the Finance Minister in November 2018, useless, thus, called for a new fiscal statement that makes up for the anomaly in the value of the cedi.

The cedi almost hit the $1: GHS6 mark this month but has seen some appreciation in value to $1: GHS5.65 following the injection of some $800 million into the system by the Bank of Ghana.

At a roundtable on the economy, a former deputy minister of finance, Mr Cassiel Ato Forson put the cedi’s woes down to bad economic management and said there was the need for a new budget to be presented to parliament by the Akufo-Addo government.

The Minority spokesperson on Finance said: “The depreciation of the cedi has put the economy in disarray and the projections surrounding it, as contained in the 2019 budget.

“This has, therefore, undermined the confidence in the economy and sends a wrong signal to the investor community,” he said.

The Ajumako-Enyan-Esiam Constituency MP said: “This calls for urgent steps to be taken by the government to restore the economic health. The starting point is that we should be immediately presenting a new budget which considers all distortions and the serious problems occasioned by the fall of the value of the cedi.

“At the minimum, we expect a statement to parliament assuring the nation and investor community of the steps taken by the government to address the instability of the economy and that … the budget, as presented by the Minister of Finance, can no longer be relied upon as a true blueprint upon which to manage the economy for the year.”

Meanwhile, President Nana Akufo-Addo has said the cedi is frail because the country has not paid much attention to the “structural problems” of the economy.

At a meeting with the leadership of the Ghana Bar Association on Tuesday, 19 March 2019, Mr Akufo-Addo said: “Our public discourse should also begin to focus on much more of the structural problems involved in our currency… There are structural problems that we so far do not articulate loudly enough in my view.”

“We live in a country where we are overly dependent on the importation of things for our daily sustenance; things that we can produce, we continue to import them. At the same time, we don’t generate enough exports, this is the real origin of the fragility of our currency,” the president lamented.

“It is the issue on the current account, the persistent deficit in our national income statistics, on our current account, that is what gives rise to the frailty of our currency”, the president complained, adding that: "The currency is currently seeing a downward trend. I am hoping that the downward trend will continue and it will get further down so that the recent upsurge will be wiped out”.

This is the second time within three weeks that the president has spoken publicly about his frustrations with the free fall of the cedi.

Addressing a ceremony held at the Tema Heavy Industrial Area, Kpone, on February 27 to inaugurate the Fujian Sentuo Ceramic Tile Factory, President Akufo-Addo, said he was aware of the anxiety there is in business circles concerning the fall of the cedi.

“I am extremely upset and anxious about it, too, but I want to assure you that all efforts are being made to arrest the decline and restore the cedi to stability in order to improve the competitiveness of the Ghanaian industry and I think very soon you will be seeing the results of our policy,” Mr Akufo-Addo said.

Source: Ghana/ClassFMmonline.com/91.3FM



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