Dr George Domfe, a Development economist and Senior Research Fellow at the Centre for Social Policy Studies (CSPS) at the College of Humanities, of the University of Ghana has said Ghanaians need to celebrate the former finance minister Ken Ofori-Atta.
According to Dr Domfe, without the DDEP and other equally important policies introduced by Ken Ofori-Atta, the current performance of the economy would not have been possible.
Dr George Domfe detailed, “One reason to praise Ken Ofori-Atta is the debt restructuring program! As a result of this, the outflows of foreign currencies to honour the country’s external interest payments and amortisation have gone down drastically! Such are the good things the former finance minister did to save the future. Ghanaians should celebrate him for these efforts.
“Without the DDEP and other equally important policies introduced by the then finance minister, Ken Ofori-Atta, the current performance of the economy would not have been possible. IMF program has helped with the current BOG reserves, which has provided the space for the BOG to intervene in the forex market with almost $1 billion in 2 months,” he said.
He added, “Indeed, as part of the program, Ghana was supposed to build its reserves. The current Ghana’s exchange rate regime is a Managed Floating Exchange Rate Regime. Under such a regime, the central bank intervenes in the local forex market periodically to protect the local currency. This is exactly what BOG is doing now, significantly because of which the cedi is performing extraordinarily well.
“You cannot give what you don’t have, therefore, the Bank of Ghana is currently giving out more to protect the cedi because it has more reserves, reserves which were increased by Ken Ofori-Atta through his policy interventions.”
Dr Domfe added, “Of course, the previous administration could have done same, but the external environment wasn’t conducive as it is now. Indeed, Dr Ernest Addison once mentioned that he could bring the cedi/dollar rate to GH¢10, but such an intervention at the time wasn’t necessary.
“Today, there is a lower demand for foreign currencies as a result of: (A) a fall in the global crude prices (and therefore BDCs are importing refined oil with far less amount of foreign currencies) (B) government’s refusal to pay contractors (C) government not honouring statutory payments.
Again, inflows from gold exports and remittances have gone up to improve the supply of foreign currencies. Therefore, when BOG pumps in a whopping $1 billion within 2 months, it is not anything surprise to see the cedi performing so well,” Dr Domfe explained further.
Meanwhile, the Special Prosecutor revealed that he has triggered a process for the issuance of an INTERPOL red notice, potentially subjecting Ken Ofori-Atta, to international arrest and extradition.
