Cedi stability tied to increase domestic production

December 25, 2016
Source: Ophelia LARYEA/thebftonline.com/Ghana
Cedi stability tied to increase domestic production

The incoming government led by the President – Elect Nana Akufo – Addo is expected to focus on reviving the once vibrant agriculture sector to stimulate domestic production.

This according to an economist, Dr Ebo Turckson the move will contribute to stabilising the Ghanaian currency, the Cedi.

Dr Turkson contends that, to grow the Ghanaian economy from an import driven one to an export driven economy, will bring more foreign exchange into the market

Speaking to the thebftonline.com, economist and a Senior Lecturer at the University of Ghana, Dr Ebo Turckson said, though he expects some improvement in the structure of the economy, he will prefer that, much concentration is given to the performance of the local currency by growing the agric sector.

“We hope to see some improvement in domestic production. We are expecting agric to be the primary driver of the economy. We are mainly producing Agric products even for consumption, and that must be scaled up.''

“This is not to incline, the outgoing government have not done anything, they have done a lot, they have built some kind of infrastructure even though there issues with whether we had value for money,” he added.

The coming in of the forex is also to help further stabilise the Ghanaian cedi, once exports volumes from Ghana increases.

As at November ending 2016, the cedi had only depreciated by a mere 4.3 percent against the US dollar so far, a complete reversal of the sharp falls the currency suffered in both 2014 and 2015, which had depreciation averaged some 30 percent a year in each of those years.

Even more instructively, 3.0 percent of this year’s depreciation occurred between May and early September,

The current stability of the cedi has resumed the longest- running cedi stability since the currency was removed from the hitherto fixed exchange rate regime in the mid-1980’s; over the 16 months since July 2015, the cedi has barely fallen against the US dollar.

Although he is excited about the future because of change of government, he also praised the outgoing government for a good job done.

Dr Turckson stated that he hopes that the new government will pursue the right policies to get the economy back on its feet.