A senior lecturer at the Department of Economics, University of Ghana, Dr. Eric Osei Asibey foresees the cedi losing grounds to major trading currencies next year if steps are not taken to address the factors putting stress on the local currency.
“There is so much pressure on the cedi getting to the end of the year, if nothing is done to stablise it that could get out of hand,” Dr. Osei Asibey observed while speaking on the Super Morning Show on Joy FM, Tuesday.
As Finance Minister, Ken Ofori-Attah, rounds up preparations to deliver the 2018 fiscal policy of the government dubbed ‘Adwuma pa’ [more jobs] budget Wednesday, the Economist is worried about the unstable nature of the cedi.
To bring this under control, Dr. Osei Asibey suggests the “Central bank and monetary authorities need to be ready to look at some of these shocks that are likely to come as a result of commodity price fluctuations.”
He told Kojo Yankson, host of the Show which was broadcast live from Accra’s Octagon building, that “there is that possibility that there could be some fiscal slippage” and that would mean that government could miss its revenue targets which could blight the gains made so far.
Expected announcement of tax cuts and a reduction in electricity tariffs in the budget, could strengthen the capacity of industry to increase productivity and create more jobs, the Senior Adjunct Research Fellow at the Institute of Economic Affairs projected.
Such incentives he noted, “are good but we may not see the results almost immediately” and urged the government to quicken up the pace in rolling out its flagship programme – One district one factory policy- which he said is the key pillars upon which production will be hinged.
Meanwhile, the Chief Executive Officer of the Association of Ghana Industries (AGI), Seth Twum Akwaboa, is concerned about the instability in the supply of electricity to power industry which had resulted in rising costs of production.
While acknowledging efforts by the government to stabilise the situation, Mr. Akwaboa believes an improvement in the current situation could even better their fortunes as it will reduce the cost of production and lead to competition which will have a corresponding reduction in prices of commodities.
The AGI Chief argued that “Industry thrives on competitiveness…so any measure that helps in reducing cost of doing business is good.”
Contributing to the discussion, the Consulting Editor of The Economy Times newspaper, Toma Imire, said the Akufo-Addo administration could record a huge achievement if it successfully implements the one district one factory policy in even 100 out of the 216 district assemblies in the country.
The seasoned journalist observed the partial concentration of economic activities specific locations is one of the problems the economy suffered, therefore; the decision to build factories in other parts of the country will yield a lot more benefits.
“Even if you can create one district one factory in 100 districts…I will see it as a major success,” he said.