Ken Ofori-Atta is the major reason for current economic stability – Dr. George Domfe

Ken Ofori-Atta is the foremost purpose for present financial stability – Dr. George Domfe

Improvement Economist and a Senior Analysis Fellow on the Centre for Social Coverage Research (CSPS) on the Faculty of Humanities, College of Ghana, Dr. George Domfe, has emphasised that Ghana’s present financial restoration trajectory needs to be credited to former Finance Minister, Ken Ofori-Atta.

Based on the Founding President of Africa Coverage Lens, APL, the choice to undertake a debt restructuring program within the face of the financial challenges Ghana confronted attributable to extraneous elements, is essentially liable for the restoration the financial system is seeing.

“One purpose to reward Ken Ofori Atta for is the debt restructuring program! On account of this, the outflows of foreign currency echange to honour the nation’s exterior curiosity funds and amortization has gone down drastically! Such are the great issues the previous Finance Minister did to save lots of the long run. Ghanaians ought to have fun him for these efforts” he held.

“With out the DDEP and different equally essential insurance policies launched by the then Finance Minister, Ken Ofori-Atta, the present efficiency of the financial system wouldn’t have been doable. IMF program has helped with the present BOG reserves that has offered the area for the BOG to intervene within the foreign exchange market with an virtually $ 1 billion in 2 months” he revealed.

Certainly, as a part of this system, Ghana was supposed to construct its reserves! The present Ghana’s change charge regime is a MANAGED FLOATING EXCHANGE RATE REGIME. Underneath such regime, the central financial institution intervenes within the native foreign exchange market periodically to guard the native forex. That is precisely what BOG is doing now, considerably due to which the cedi is performing extraordinary properly, he additional defined.

“You can’t give what you don’t have, subsequently, the Financial institution of Ghana is at the moment giving out extra to guard the cedi as a result of it has extra reserves, reserves which had been elevated by Ken Ofori-Atta by way of his coverage interventions” he mentioned.

On whether or not the Financial institution of Ghana and the Finance Ministry may have injected greater than sufficient {dollars} into the financial system, that is what Dr. Domfe mentioned. “After all, the earlier administration may have performed identical, however the exterior atmosphere wasn’t conducive as it’s now. Certainly, Dr. Ernest Addison as soon as talked about that he may convey the cedi/ greenback charge to GHS10 however such an intervention on the time wasn’t essential”

“In the present day, there’s a decrease demand for foreign currency echange on account of: (A) a fall within the international crude costs (and subsequently BDCs are importing refined oil with far much less quantity of foreign currency echange) (B) authorities’s refusal to pay contractors (C) authorities not honouring statutory funds. Once more, inflows from gold exports and remittances have gone as much as enhance provide of the foreign currency echange. Subsequently, when BOG pumps in a whopping $1 billion inside 2 months, it’s not something shock to see the cedi performing so properly” Dr. Domfe defined additional.

He additional famous that the settlement with the bondholders has impacted significantly on Ghana’s debt, a discount of 37 % in nominal worth of Ghana’s debt, equal to USD5 billion in addition to a debt service financial savings of USD4.3 billion in the course of the IMF program. Curiosity on bonded debt has additionally declined from common of 8 % to lower than 5 %.

Dr. George Domfe additional famous that with this vital achievement the nation is poised for a brighter future enabling authorities to shift focus in the direction of sustainable financial progress and growth, describing it as a testomony to Ghana’s dedication to financial restoration and units the stage for improved fiscal administration and sustainable progress.

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