Bank of Ghana
gives state of economy
Governor says
foreigners change money in Ghana
African
Development Bank to assist Ghana with 80 Million-dollar loan
Good management
key to successful business - Lawson
Bank of Ghana gives state of economy
Accra (Greater Accra) 03 September 2002- Ghana's consumer price inflation
dropped from 13.7 per cent in June to 13.5 per cent at the end of July. Dr Paul
Acquah, Governor of the Bank of Ghana (BOG), said the inflationary figure was
edging close to the end-year target of 13.0 per cent.
He was giving a review of the
macro-economic performance so far this year at a news conference in Accra on
Monday. Dr Acquah said favourable movements in interest rates followed the BOG
prime rate introduced in March this year.
He said during the period under
review, "the domestic money market remained firm with rates converging on
the short end around the BOG prime rate. Money market interest rates continued
on a downward trend observed from the beginning of the year through April/May,
but has since edged upwards."
The benchmark 91-day Treasury Bill
Rate declined from 29.0 per cent in December 2001 to 24.6 per cent in May 2002.
The figure, however, increased to 25.4 per cent in August 2002. Dr Acquah said
the overall government budget deficit for the first half of the year was below
the projected 1,723 billion cedis.
"The private sector holdings
of government debt instruments increased by 16 per cent to account for a somewhat
larger proportion of 55 per cent of the total stock of debt instruments at the
end of July 2002.
"The average inter-bank money
market rate increased steadily from 22.1 per cent to 24.5 per cent by May 2002
and dropped to 22.6 per cent in June", Dr Acquah said and added that the
figure had since increased to 23.0 per cent in August commercial bank rates
had, however, remained within a range of 26 and 29 per cent.
The Governor said government
revenue was higher while expenditure was lower than projected. "However,
the borrowing requirement of the government during the year to July 2002 turned
out larger than projected mainly due to accelerated liquidation of government
arrears; less than projected receipts from divestiture and some delay in disbursement
of donor inflows," the Governor said.
He said the year-on-year reserve
money growth was close to the end year target of 19.0 per cent as it reduced
sharply from 37.3 per cent in July 2001 to 19.3 per cent at the end of July
2002. On the other hand, the broad money growth increased from 35.5 per cent to
46.1 per cent while foreign currency deposits in dollar terms increased by 50
million dollars between December 2001 and July 2002.
Dr Acquah said the year to date
private sector credit expanded by 16.7 per cent as compared to 18.4 per cent
over the same period in 2001 and about half of the credit growth this year was
channelled into manufacturing and commerce.
On the exchange rates, he said,
"commercial banks' purchases of foreign exchange on the market as at
August 2002 was some 550 million dollars or 25.5 per cent above the
corresponding amount in 2001."
The cedi lost some ground on the
foreign exchange market depreciating by 13 per cent against the British pound.
Dr Acquah described the decline as "somewhat more rapid than the US
dollar, which depreciated by 8.0 per cent against the pound. He noted that
there was a realignment of major currencies on the international foreign
exchange market with the Euro moving to parity against the dollar in July 2002.
The Euro has since shed some of
the gains. Asked to comment on the depreciating rate of the cedi, the Governor
said it was true that foreigners take advantage of the "porous border
regulations" and liberal exchange regulations to enter Ghana to change
monies to the dollar.
He said the Bank, however, did not
know the extent to which this practice had contributed to the fall of the cedi.
Dr Acquah said export commodity prices remained firm although there was a
downside risk inherent in oil prices in view of developments in the Middle
East.
He said the immediate outlook was
for a good balance in external payments with rising inflows beginning with
cocoa cycle and sustained inward remittances expected to coincide with the
seasonal demand for imports to sustain consumption and output growth.
"Restraint in fiscal
operations together with enhanced revenue mobilisation would provide additional
impetus to macro-stabilisation and diminishing inflationary expectations,"
Dr Acquah observed, saying; "seasonal food pressures on overall inflation
should be abating given the anticipated good crop harvest."
He said the BOG prime would remain
unchanged at 24.5 per cent given the balance of risks in the economic outlook.
In an interview with the GNA, Mr Daniel Ogbamey Tetteh, Vice President of Data
Bank Services Limited, said the outlook fell short of projected growth in the
economy.
He said, however, that the general
stability was good for the private sector that could borrow on lower interest
rates. He said the environment was also good for managers of industries to
comfortably make projections for the next year.
GRi…/
Send your comments toviewpoint@ghanareview.com
Governor says
foreigners change money in Ghana
Accra (Greater Accra) 03 September 2002- Dr Paul Acquah, Governor of the Bank
of Ghana (BOG), said on Monday that foreigners changed their money in Ghana as
a result of the loose border and exchange regulations that pertained in the
country.
He said: "porous border
restrictions and liberal exchange regulations" are the main factors that
have contributed to foreigners changing money in Ghana. He, however, said that
the Bank did not have figures to show the extent to which it affected the
depreciating rate of the cedi.
Dr Acquah said this in reaction to
question whether the practice was a contributory factor to the high
depreciating rate of the cedi at a press conference in Accra. The cedi rate of
depreciation at half year was 13 per cent to the British pound.
The cedi began the year at 10,618
cedis to the pound and was expected to stabilise in view of stringent fiscal
policy measures instituted by the Bank. However, the cedi continued to
depreciate at a steady pace and this had been blamed on many factors including
the fact that foreigners came to Ghana to change their money into dollar and
any other currency if available.
The Security Agencies told the
Ghana News Agency that some commercial banks were facilitating the changing of
dollars by foreigners. Some of the banks allowed foreigners to en-cash large
amounts of ECOWAS Travellers' Cheques into cedis, which they subsequently took
to the forex bureaux to change into dollars.
GRi…/
Send your comments toviewpoint@ghanareview.com
African
Development Bank to assist Ghana with 80 Million-dollar loan
Accra (Greater Accra) 03 September 2002-The African Development Bank (AfDB) is
to provide between 70-80 million dollars to Ghana within the next three years
for its development efforts.
The money is to be used to improve
the agriculture sector, rural development, infrastructure in the social sector,
especially education and health, good governance and micro financing for the
small and medium scale enterprises.
This was announced by Mr Bisi
Ogunjobi, AfDB Vice President in-charge of Operations, at a press briefing
after a meeting with the Economic Management Team (EMT) in Accra on Monday.
Mr Ogunjobi is on a four-day visit
to Ghana to hold consultations with the government on the Bank's assistance and
assess the impact and effectiveness of its interventions to promote sustainable
development and the fight against poverty.
He said this year the Bank had
provided 17 million dollars for the rehabilitation of the Tema-Aflao road, nine
million dollars for the Community Forestry Management for sustainable
development and another assistance for a Livestock Development Project. This
was in addition to the financing of 21 on-going projects estimated at about 356
million dollars in the country.
Mr Ogunjobi said the government
had performed well since it assumed power but stressed the need for Ghanaians
and the private sector to support it because the government on its own could
not perform better, adding "Private partnership is the only way to reduce
the level of poverty in the country".
GRi…/
Send your comments to viewpoint@ghanareview.com
Good management key to successful business - Lawson
Accra (Greater Accra) 03 September 2002-Mr Andy Lawson, Executive Director of
the Association of Ghana Industries (AGI), on Monday said tough the present
macroeconomic conditions had contributed to a slow industrial growth there was
the need to improve company competitiveness on the global market.
He called for good management
practices to help companies increase productivity and become more competitive.
He was addressing the opening of a four-day workshop on: "Profit Centre
Management for Ghanaian Businesses" organised by the AGI in collaboration
with the Friedrich Nuamann Foundation (FNF) for decision-makers of selected
companies.
The workshop is aimed at helping
businesses identify measures to develop and implement activities for the benefit
of companies and the industrial sector as a whole. Mr Lawson said Ghanaian
business had no choice but to participate in the competitive global arena even
though the over 30 per cent borrowing rate was still too expensive for
businesses.
He said businesses should not only
concentrate on the local market but also the export market, where although
challenging, the results were more rewarding.
Mr Lawson said the AGI had recognised the enormous potential in the export
market, especially in the ECOWAS Sub-Region through a study conducted in 2000
and its recent exhibition in Burkina Faso.
He said the AGI had, therefore,
recognised the importance of empowering local companies with the requisite
management tools to be able to compete effectively at all markets. Mr Kwamena
Bartels, Minister for Private Sector Development, said there was the need to
cut through red-tapism that hampered the growth of the private sector.
He said the recognition that
profits were the driving force of the private sector would make it become more
efficient and that Ghanaian companies needed to add value to their products
rather than exporting raw materials.
Mrs Majorie Beeko, Programme
Officer of the FNF, said it was hypocritical for countries to champion free
trade on one hand only to raise high tariffs on imports, adding that the
socio-economic gains the market economy promised could only materialise when
the playing field was levelled.
GRi…/
Send your comments to viewpoint@ghanareview.com
Stock index
inches up
Accra (Greater Accra) 03 September 2002- The main gauge of the Ghana Stock
Exchange (GSE), the GSE All-Share Index, inched up by 0.27 points on Monday in
slow trading, after a significant 10.2-point jump last Friday. Four equities
made gains, but only by one cedi each with a mere 6,000 shares changing hands,
down from 69,200 on Friday.
The GSE All-Share Index closed at
1,309.98 points from 1,309.71 points. Accra Brewery Limited (ABL), Ghana
Commercial Bank (GCB), Guinness Ghana Limited (GGL), SSB Bank Limited (SSB)
were the gainers. ABL ended at 376, GCB closed at 3,311 cedis, GGL ended at 912
and SSB closed at 3,859 cedis.
The change in the year to date was
37.03 per cent from 37.01 per cent on Friday while Market Capitalisation was
also higher at 4,859.29 billion cedis from 4,868.77 billion cedis.
The following are the last prices
of listed equities in cedis:
ABL 376 +1
AGC 18,801
ALW 4,000
BAT 939
CFAO
66
EIC
4,500
FML
1,627
GBL 900
GCB
3,311 +1
GGL 912 +1
HFC 955
MGL 254
MLC 261
MOGL 19,700
PAF 750
PBC 440
PZ
1,810
SCB 26,005
SPPC 387
SSB
3,859 +1
SWL 285
UNIL
4,202
CMLT 460
GRi…/
Send your comments to viewpoint@ghanareview.com