Government urged to create Financial Stability Council

Speakers at the just-ended Institute of Chartered Accountants Ghana (ICAG) public lecture in Accra under the theme “Review of Ghana’s 2019 Budget Statement and Economic Policy” have admonished government to follow through with the promise of creating the Financial stability council to strengthen surveillance and complement the efforts of the Central Bank.

Mr. Franklin Cudjoe, President, Imani Center for Policy & Education said reforms outlined by the various working groups set up by the Ministry of Trade and Industry on the World Bank Doing Business indicators should be critically considered for implementation.

Reforms such as regulating adjournments and court automation can significantly reduce time to enforce contracts in Ghana.

He said Updates on the one district one factory project should be detailed enough to adequately inform the public of the prospects and sustainability of the 1D1F program and generally Ghana’s current attempt at industrialisation. It will also inform the investment community on which aspects of the value chain they can plug into.

“Continuous effort must be made by government to address the tourism sector infrastructure deficit. Public private partnerships are highly recommended”, Mr. Cudjoe said.

He said government should fast track the implementation of the national identification system and the digital addressing system to complement other efforts to formalise the economy.

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“This will ensure consistency and coherence and revenue mobilisation policies, Government policies must be driven by research and broader stakeholder consultation to ensure relative predictability of policy.

Otherwise, direct and indirect costs incurred by industry will lead them to align themselves away from the objective of policy, ie. the introduction of the Cargo Tracking Note (CTN) system”, Mr. Cudjoe explained.

He said the government should, as a matter of urgency, publish its liquidity plan, including contingency arrangements, in the now very likely scenario that should the projects commence this year as envisaged, Ghana shall not be in a position, come 2021 to commence paying Sinohydro for accumulated debts from the proceeds of “refined bauxite” sales.

Mr. Isaac Nyame, Managing Consultant, Ikern & Associates said Government’s proposed equity holdings for the tax exemptions raises a number of questions in terms of: The type of exemptions that will qualify for conversion into equity; How the value of the exemption-converted shares will be determined;

What happens to the existing mining companies that have exemptions protected by a fiscal stability agreement. Will this send a negative signal in terms of subsisting contractual arrangements between Ghana and these investors.

He said to ensure acceptability and fairness, Government needs to consult with stakeholders extensively before implementing the proposed measures.

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