{"id":8629,"date":"2014-03-26T07:06:37","date_gmt":"2014-03-26T07:06:37","guid":{"rendered":"http:\/\/4cd.e16.myftpupload.com\/?p=8629"},"modified":"2014-03-26T08:20:51","modified_gmt":"2014-03-26T08:20:51","slug":"bog-measures-on-cedi-depreciation-not-working-bawumia","status":"publish","type":"post","link":"https:\/\/citifmonline.com\/?p=8629","title":{"rendered":"BoG measures on cedi depreciation not working \u2013 Bawumia"},"content":{"rendered":"
\"Dr.<\/a>
Dr. Bawumia<\/figcaption><\/figure>\n

The 2012 vice presidential candidate of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia has indicated that the Bank of Ghana\u2019s (BoG) measures to save the depreciation of the cedi will not work.<\/p>\n

He opined that dollarization is a \u201cvote of no confidence in the local currency\u201d and should therefore not be blamed for the depreciation of the cedi.<\/p>\n

According to him, the BoG\u2019s directives \u201care retrogressive steps that have destroyed so much of the hard work on the foreign exchange market going back 30 years.\u201d<\/p>\n

The central bank in February this year announced certain measures to halt the free fall of the cedi by revising the rules governing the operations of Foreign Exchange Accounts (FEA) and Foreign Currency Accounts (FCA).<\/p>\n

Banks were ordered not to grant a foreign currency denominated loan or foreign currency linked facility to a customer who is not a foreign exchange earner.<\/p>\n

All exporters were also urged to collect and repatriate in full, the proceeds of their exports to their local banks within 60 days of shipment.<\/p>\n

But delivering a public lecture on \u201cRestoring the Value of the Cedi\u201d at the Central University College in Accra, the former Deputy Governor of the BoG mentioned that since the central bank started the implementation of the new policy to curb dollarization, \u201cthe cedi has depreciated an additional 6.4%.\u201d<\/p>\n

He maintained that the directives \u201care not working; in fact, they will not work\u201d and blamed the weakened fundamentals of Ghana\u2019s economy as being the sole cause of the depreciation of the Ghana cedi.<\/p>\n

Dr. Bawumia listed \u201cslower growth, large fiscal and current deficits, rising inflation, rising inflation, rising interest rates, rising debt levels and low levels of international reserves\u201d as being the cause of the loss of confidence by investors which has also caused the \u201cdowngrading of Ghana\u2019s sovereign credit rating agencies.\u201d<\/p>\n

The former BoG Governor urged\u00a0government to admit the economy is in crisis \u201cso that it can carry the country along and get public support for the tough remedial measures it may have to take. The denial must therefore stop.\u201d<\/p>\n

Policy credibility to assure investors \u201cGhana is a safe bet,\u201d he said adding that \u201cgovernment must resist the temptation to make new promises and commitments of expenditure for new programmes.\u201d<\/p>\n

He also called for the restoration of fiscal discipline, the checking of revenue leakages, expansion of the tax net, effectively tackle corruption among others to save the economy.<\/p>\n

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By: Efua Idan Osam\/citifmonline.com\/Ghana
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