Ghana
achieves two of four monetary criteria
Single
currency requires vigorous trading - Osafo-Maafo
Ghana
achieves two of four monetary criteria
Conakry (Guinea) 08
November 2002- Ghana achieved two out of the four main convergence criteria for
the West African Monetary Zone (WAMZ). Dr Abdul Wahab Alhassan, Chairman of the
Technical Committee of WAMZ disclosed this to newsmen in Conakry on Thursday,
during the meeting of the Heads of State and Government of member states of
WAMZ.
He said Ghana attained
a budget deficit of three per cent while the Central Bank Financing of
government deficit was about nine per cent. The Convergence criteria were a
single digit inflation rate of about five per cent by April this year, Central
Bank Financing of government deficit of less than 10 per cent of the previous
year's revenue, Government budget deficit of five per cent Gross Domestic
Product (GDP) and Foreign Exchange Reserves in three months of import.
Dr Alhassan who is
also the Director, Policy Analysis Division of the Ministry of Finance, said
inflation rate from the beginning of the year at 41 per cent was now about 12.6
per cent.
He said member
countries were on course to achieve the targets for the adoption of one
currency but not within the time frame of January 2003, hence the suggestion by
the Technical Committee for an extension of time.
Dr Alhassan said
Gambia had been the best performer to achieve all the four criteria within the
period but currently, had achieved only three, while Nigeria, Guinea and Sierra
Leone had achieved at least one.
The Chairman of the Technical
Committee said there was a new provision that when two or three member states
achieved the criteria, the convergence could begin without necessarily waiting
for the other countries.
GRi…/
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Single
currency requires vigorous trading - Osafo-Maafo
Conakry (Guinea) 08
November 2002 - Yaw Osafo-Maafo, Minister of Finance on Thursday, said the
establishment of a single currency for the West African Sub-Region would be
meaningless without a vigorous trading environment.
He said "A single
currency is of no use, if there is no trading to do with it". Briefing
newsmen at the one-day Fourth Summit meeting of the Heads of State and
Government of Member States of the West African Monetary Zone (WAMZ) in
Conakry, Osafo-Maafo said trading should precede the whole idea of a monetary
union between Ghana, Guinea, Gambia, Nigeria and Sierra Leone.
Osafo-Maafo, who is
also the out-going Chairman of the Convergence Council of WAMZ said, "West
Africa should trade among itself than we are doing now. We are doing only 10
per cent of trade among ourselves and 90 per cent with outsiders from the
Sub-Region", he added.
The Finance Minister
said achieving single-digit inflation was difficult but with the extension of
the period to attain the convergence criteria it was feasible to achieve an
inflation rate of five per cent by 2005.
He noted that
attaining the convergence criteria now required effective economic management
and discipline. "We are going to achieve it but there should be a lot of
efforts from the governments both political and economic," he added.
Dr Paul A. Acquah,
Governor of the Bank of Ghana (BOG), said to achieve the targets for the
convergence criteria required commitment to develop policies that could have
important macro-economic effects.
He said there should
be the commitment to ensure fiscal discipline. Dr Acquah said other commitments
were to implement reforms that affected the efficiency of economies, remove
distortions that existed in various economies and make sure they served to
integrate the economies into one efficient economic space.
The Governor explained
that trade barriers must be removed, tariffs and tax systems and regulatory
framework should be harmonised to give confidence to businessmen and traders
working within a common economic space.
GRi…/
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