Cedi fights: we need to focus on structural fundamentals – Nana Addo

General News of Tuesday, March 19, 2019

Source: citinewsroom.com

2019-03-19

President Nana Akufo-Addo called for broadening the discussions on the troubled cedi which, he said, had left him "extremely upset and worried".

Speaking at a meeting with leaders of the Ghana Bar Association, President Akufo-Addo said that the focus should be on the structural problems of the economy.

"Our public discourse should also begin to focus more on the structural problems of our currency (…) there are structural problems that we have not yet articulated strong enough in my opinion."

"We live in a country where we depend too much on importing things for our daily subsistence. things we can produce, we continue to import them. At the same time, we do not generate enough exports, "added the president.

He further explained that "it is the issue of the current account, the persistent deficit of our national income statistics on our current account that explains the fragility of our currency."

The Akufo-Addo administration had already praised the macroeconomic fundamentals deemed favorable.

In this regard, the government benefited from the improvement in the 2018 credit rating of the international rating agency Standard & Poor's.

But that did not stop the cedi from depreciating against the dollar, from 4.9 to 4.5 GHc since the beginning of the year.

In 2018, the cedi is depreciated by 8.4% against the dollar.

State intervention in the short term

The government expects a new capital injection, such as the $ 750 million Standard Bank Bridge Loan, to meet the challenges currently facing the cedi.

The government is also considering COCOBOD funds and the launch of the $ 3 billion eurobond.

The cedi has depreciated against the dollar from 4.9 to 4.5 G since the beginning of the year.

Finance Minister Ken Ofori-Atta commented on the government's short-term decision: "We're going after; $ 300 million, $ 600 million and $ 750 million and $ 3 billion, and [I think] it should be fine. And all this should happen in the next two or three weeks.

But the minority in Parliament called these measures unsustainable.