The Deputy Minister of Finance, Mona Helen Quartey has reiterated government’s commitment to push through policies that will cool down inflationary pressures and stem the slid of the cedi.
She said the current macroeconomic challenges that have seen the cedi depreciated about 40% since January, inflation reached 15.9% and central bank’s policy rate hit 19% will be put under control when the homegrown policies developed by government will are all implemented.
Ms. Quartey assured employers at the 54th annual general meeting and business luncheon of the Ghana Employers’ Association in Accra that government is aware of the impact of the falling cedi, the continual energy crises and the rising costs of production on businesses in the country, and that it is working to avert the situation.
“Government is leaving no stone unturned in solving the challenging macroeconomic situation within the shortest possible time.”
“For instance, the exchange rate measures that were introduced in January this year have been pulled back due to complaints from the business sector and it is evident that the cedi has largely stabilised since its removal,” she said, and partly blamed the current economic downslide on the increased imports to the country.
“The practice where we import almost every consumable product in the country exposes the economy to uncontrollable external shocks. Because of the fact that we are price takers, commodity price shocks affect us adversely,” she said.
The comments follow earlier assurances by the president, John Mahama that critics who are pessimistic about a turn-round in the current economic conditions will soon be disappointed.
The government has sort help the International Monetary Fund (IMF) to address the fiscal challenges of the country and a team from the Bretton-Woods institution is expected in Ghana next week to begin crunch talks with the government on how the Fund could help the country’s economic programme and accelerate Ghana’s journey to restore economic stability.
Currently, the cedi has been tagged Africa’s worst-performing currency in 2014, as it declined 20.6 percent against the dollar in less than five months, its worst performance since 2000, when the currency lost almost 50 percent to the greenback.
A survey conducted by the Association of Ghana Industries (AGI) shows that about 63.5 percent of businesses in the country will not be able to create more jobs in the next six months while 15 percent confirmed that they were certain to reduce their employment figures due to operational constraints brought about by the rising costs of production and erratic power supply.
Last week, the Ghana Chamber of Commerce and Industry, in a statement whose undertone exposed the frustration of companies in the midst of the current economic situation, warned of “catastrophic” consequences if government failed to halt the trend.
The Minister assured businesses that with the country set to produce its first gas from the Jubilee Field by the first quarter of 2015, which will be used primarily for power generation, the power situation will be resolved.
She said government’s 5,000 megawatts electricity generation capacity target coupled with the gas to be flown by the Tweneboa-Enyenra-Ntomme (TEN) Field and the Sankafo-Gye Nyame Fields by 2017 will further supply cheaper and sustainable energy to industry to drive production.
She implored the private sector to help stabilise the economy in order to create the congenial atmosphere for businesses to thrive.
President of the Ghana Employers’ Association, Mr. Terence Darko, said government must help to make local businesses more competitive by leading the way in patronising made-in- Ghana products and services to reduce the pressure on the country’s forex reserves.
He called for effective collaboration between government and the business community to improve the macroeconomic environment to bolster investor confidence in the country.
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