ghananlpcommunity/ghana-gov-speeches-sentences huggingface dataset:
These tight monetary policy actions are expected to dampen the heightened inflationary pressures in the medium term.
 Reversal of Covid -reliefs: In addition to the policy rate increases, t he B ank h as reversed the prudential regulatory reliefs exten ded to universal banks at the height of the pandemic.
Under these measures, the Cash Reserve Ratio was increased to 12 percent; the Capital Adequacy Ratio reset back to 13 percent; and the provisioning rate for loans in the Other Loans Exceptionally Mentioned (OLEM) category reset to the pre-pandemic level of 10 percent.
These are intended to withdraw excess liquidity from the system and moderate demand pressures.
 Extended FX Auctions: To ease off increased volatility in the foreign exchange (FX) market, the Bank extended the forward auctions to include the Bulk Oil Distributing Companies.
Th is formed part of the measures taken by the Bank to address the FX liquidity constraints within the local petroleum sector and aid price discovery, especially for the general pricing window within the downstream sector.
 Fiscal measures: To complement all these efforts, the government announced a 20 percent expenditure cut while enhancing revenue mobilization measures to ensure the attainment of the fiscal deficit target for 2022.
The government further announced a syndicated arrangement of US$2.0 billion in line with approved external financing for 2022 and for liability management.
The monetary policy rate hikes , reversal of the regulatory reliefs, and the announcement effect of the fiscal measures have impacted positively on the FX market, and the local currency has regained some of the first quarter losses.
These are positive signals to boost investor confidence in the outlook.
Going forward, the Bank will continue to implement additional prudent monetary and external sector policies to ensure price and exchange rate stability for business growth.
These would help re-anchor inflation expectations and restore confidence in the economy.
Chairman, now let me turn attention to the theme for the day, that is, “digital leadership for a digital economy ”.
As you are all aware, the Bank has been at the forefront of the digitisation agenda for close to two decades now.
This started with the passage of the Payment Systems Act 2003 (Act 662), which provided the legal and regulatory basis for the introduction of technology in the banking industry .
This was followed with the implementation of a real time gross settlement system, which is the Ghana Interbank Settlement (GIS) system.
This infrastructure significantly improved the efficiency of wholesale and large value interbank funds transfer and liquidity management.
In 2007, additional institutional reforms were carried out which led to the establishment of the Ghana Interbank Payment and Sett lement Systems Limited (GhIPSS) .
Since then, GhIPSS has rapidly transf ormed the payment ecosystem through the implementation of interoperable interbank retail payment systems, including electronic cheque clearing, automated clearing house for direct debit and credit funds transfer, instant payment, gh -Link card, and mobile money interoperability.
At the next phase of the digitisation agenda, the Bank reinforced the regulatory frameworks to tackle financial exclusion in a practical and affordable manner.
This led to the issuance of Branchless Banking Guidelines (BBG) in 2008, which provided the regulatory support for mobile money through partnerships between banks and telecommunication companies.
A further review of the BBG led to the Electronic Money issuers and Agents Guideline in 2015 , to address some regulatory challenges and boost adoption of the mobile money concept.
These regulatory changes provided the nee ded boost to the expansion of mobile money operations and set the stage for financial technology in Ghana.
The enabling regulatory environment attracted several FinTech companies into the ecosystem, who introduced innovative digital financial products an d services on the back of mobile money operations.
This notwithstanding, the operations of FinTechs were largely unregulated, and to better harness their potential, an e xtensive review and consolidation of laws, regulations, policies and guidelines within the payment systems was done.
This led to the passage of the Payment Systems and Services Act, 2019 (Act 987) , which has since established a conducive environment for inclusive and competitive delivery of digital financial services.
Chairman, in line with the rapid innovation in digital financial services, the Bank adopted the Regulatory and Innovation Sandbox approach to support the process.
Currently, the sandbox provides live -tests of innovative digital financial service products, business models and supportive technologies in a controlled environment for possible market rollout.
More recently, the Bank took a major step to explore a central bank digital currency within the framework of the financial sector digitization programme.
In partnership with G+D Technology, the Bank is currently piloting the issuance of the digital currency.
This project presents a unique opportunity to design a technological representation of a fiat currency that will drive the financial sector digitiza tion further and also facilitate the government’s inclusive digital transformation programme.
In keeping with the Bank’s commitment to digitization of the sector, the eCedi project is progressing steadily.
Since financial inclusion is one of the objectives for embarking on th e CBDC pilot, the Bank has deemed it necessary to test an offline version of the eCedi that can be used for consecutive payments between individuals and merchants, where there is no connectivity infrastructure, just like cash.
Digitising the offline transactions of rural and frontier households holds the key to creating the necessary market linkages that could result in access to finance in future.
So far, the usage and uptake of the offline version of the eCedi is being piloted in a small town called Sefwi Asafo in the Western North region.
Select users in that community have been using the eCedi for daily purchases such as for food, grocery and drinks.
The Bank will continue to work with these users to obtain the critical usage data that will inform the decision about the eCedi's future after th e pilot.
These are clearly landmark events in providing digital leadership with the payment systems, to lead to a digitised economy in the near future.
Conclusion 18.
In conclusion, Ladies and Gentlemen, t he Bank remains confident that ongoing policy efforts should help re -anchor inflation expectations, restore confidence in the economy and ensure that businesses operate in an environment of stability .
In this regard we w ill work assiduously to ensure inflation stability.
It is a known fact in the literature that inflation is detrimental to economic progress.
Safeguarding inflation will inure benefits to businesses and the poor in society.
While working to safeguard macroe conomic stability the Bank will continue to work with partners in the private sector and other relevant institutions to strengthen the payment ecosystem to support the financial inclusion and digitization.
Thank you for your very kind attention.
JOURNALISTS FOR BUSINESS ADVOCACY (JBA) TRAINING WORKSHOP IN FINANCIAL REPORTING THEME: ACCURATE REPORTAGE, KEY TO FINANCIAL STABILITY REMARKS BY DR.
MAXWELL OPOKU-AFARI, FIRST DEPUTY GOVERNOR, BANK OF GHANA, READ ON HIS BEHALF BY PHILIP ABRADU-OTOO, DIRECTOR OF RESEARCH, BANK OF GHANA ECOBANK HEAD OFFICE, ACCRA 28TH APRIL 2022 1 | P a g e Distinguished Ladies and Gentlemen of the media, 1.
It is my pleasure to join you at this media training workshop.
First of all, let me thank the Executives of the Journalists for Business Advocacy (JBA) for the invitation to share a few thoughts on the theme “Accurate reportage, key to financial stability”.
I consider the chosen theme appropriate as the global economy’s recovery from the Covid-19 pandemic has been severely dented by geopolitical tensions in Eastern Europe.
The ongoing conflict has triggered a downgrade of global growth forecasts by the IMF while the crisis has also heightened inflationary pressures due to rising food and energy prices.
These developments have far-reaching implications for the domestic economy and stresses the need for accurate reportage by financial journalists to calm financial market participants and prevent disorderly reactions during these periods of heightened uncertainty.
My remarks will therefore broadly focus on : the current sta te of the Ghanaian economy and the policies being pursued; the macroeconomic outlook and policies going forward; and the need for accurate reportage on these developments to rebuild confidence in the economy.
At the start of 2022, the global recovery process seemed to gain some traction from the Covid- 19 pandemic effects, supported by i mproved va ccinations and opened economies, despite persisting supply chain constraints.
However, these gains have been short-lived due to major upheavals in Ea stern Europe .
The ongoing conflict , coming on the heels of the Covid -19 pandemic, has heightened uncertainty in the financial markets and triggered commodity price shocks.
Based on these developments, the global outlook weakened somewhat, prompting the IMF to downgrade global growth projections for 2022 and beyond to 3.6 percent, from the projected 4.4 percent in January 2022.
These downgrades suggest challenging times ahead in the global economy , unless there is a resolution to the war in Ukraine, alongside possible lifting of sanctions against Russia by the West.
In addition to the potential slowdown in economic activity, the global economy has witnessed a surge in inflation fuelled by rising food and energy prices , persistent supply chain bottlenecks, and rising demand pressures as economies reopened.
Currently, inflation has breached the set targets in most countries.
In the US, for example, CPI inflation surged to 8.5 percent in March 2022, a 40 -year high, from 2.6 percent in March 2021.
Similarly, inflation in the Euro Zone reached 7.5 percent in March 2022.
Ghana’s inflation has also trended high and the March 2022 inflation rate of 19.4 percent is the highest since August 2009 when inflation was reported at 19.6 percent .
The elevated le vels of inflation across a dvanced economies and emerging markets and developing countries has prompted reversal of the Covid-related accommodative policies that provided liquidity injections to the economy.
Most central banks, as a result, have commenced tightening of their monetary policy stance.
Rising interest rates, especially in a dvanced economies, have led to tighter global financing conditions, leading to capital flow reversals and currency pressures in emerging and frontier economies, including Ghana.
Given that Ghana is a market access country, the tightening of global financing conditions , combined with fiscal policy strains, led to widening of the country’s sovereign spreads and increased the costs and risks associated with accessing international financial capital markets, leading to a defacto closure of the international markets to Ghana.
The foreign exchange market responded to these events and also witnessed some volatility in the first quarter of 2022, with the local currency depreciating by about 15.6 percent (y-t-d) against the US dollar in March 2022.
These developments prompted strong and coordinated monetary and fiscal policy measures, including a hike in the policy rate by 250 basis points to 17.5 percent, the reversal of the Covid-related macroprudential regulatory relief measures, and the Government’s announced 20 percent cut in expenditures as well as an additional 10 percent cut in discretionary spending to support the fiscal consolidation process.
The Government further announced a syndicated arrangement of US$2.0 billion in line with approved external financing for 2022 and for liability management.
These measures are expected to help regain macroeconomic stability and boost investor confidence in the domestic economy.
3 | P a g e 7.
Also, t he Bank of Ghana extended the forex forward auctions to include the Bulk Oil Distributing Companies (BDCs) to ease off increased volatility in the foreign exchange (FX) market.
In the maiden auction on 30th March 2022, the Bank sold about US$104.86 million above the auction target of US$100 million to the BDCs.
The FX forward auctions were part of the measures taken by the Bank to address the FX liquidity within the local petroleum sector, minimize the uncertainty of future FX availability and aid price discov ery, especially for the general pricing window within the downstream sector.
This strategy has contributed to the relative stability observed on the forex market and, with some normalization underway, the trend is expected to continue until the local currency returns to its fundamental equilibrium level.
The economy has rebounded strongly from the pandemic , as evidenced by the national accounts data recently released by the Ghana Statistical Service.
The overall real GDP growth was 5.4 percent in 2021, higher than the targeted 4.4 percent.
Non-oil GDP growth was 6.3 percent.
These developments point to a robust economy that is pushing toward its pre - pandemic level, though downside risks remain, including potential outbreak of new variants of the Covid-19 pandemic and further headwinds from the Russia-Ukraine war.
Headline inflation has shifted above the upper band of the medium-term target, driven mainly by food prices, upward adjustments in ex-pump petroleum prices, transport costs, and pass- through of exchange rate depreciation.
The l atest data show s that headline inflation rose sharply to 19.4 percent in March 2022 from 15.7 percent in February on the back of significant increase in food inflation.
In addition to these trends, there are significant upside risks to the inflation outlook, including increased commodity prices, particularly crude oil, and intensified supply disruptions.
The Bank’s forecast indicates that inflation would trend back towards the medium-term horizon over the next four quarters.
The remarkable resilience exhibited by the banking sector over the two-year period could be attributed to the comprehensive financial sector reforms that took place before the Covid-19 pandemic struck in 2020 .
The sector continues to remain liquid, profitable, and well - capitalised.
The industry’s measure of solvency, the Capital Adequacy Ratio , has remained 4 | P a g e well above the revised regulatory 13 percent prudential limit.
Asset quality, however, declined marginally.
Permit me to touch on an issue which I think is very important and that is confidence .
Efforts at boosting confidence will have to come from all facets of economic life.
The institutions must play their role, private agents must take advantage of conditions around them, Government must play its role in delivering growth in a stable economic environment and the Central Bank will have to guarantee low and stable inflation using the tools available at their disposal.
The press must leverage all to influence the direction of economic thinking and to influence society.
Let us remember the IPI cardinal principle of journalism.
The press must Inform, Persuade and Influence soci ety.
In so doing the press will have to use all available data at their disposal, to drive analytical discourse and imbibe confidence.
Journalists must go beyond the data provided them and do more interrogation of the data to understand better, the data generating facts.
All these work in concert to engender economic confidence and this is where we ought to be moving towards.
Some policy strategies that will improve sentiments about the economy and help catalyze growth include but not limited to:  Expenditure-control measures by Government, together with new revenue mobilization measures, that would support the fiscal consolidation path and help lift financing constraints.
 Policies to improve the business operating environment to attract private capital, b oth foreign direct investment and portfolio investment through rule of law, protection of property rights, transparency and accountability and political and macroeconomic stability will contribute immensely to regaining investor confidence.
 Exports diversification and building imports substitution industries to leverage the African Continental Free Trade Area that provides a tremendous opportunity to increase intra- regional trade and regional integration .
This will help improve the trade balance and possibly the current account and reduce the need for external financing.
5 | P a g e  Leveraging technology to improve remittance flows, d igitalization and mobile money applications which offer a great opportunity in improving the financial landscape.
The payment system had been identified as one of the many critical preconditions that will have to be put in place to foster the building of a strong business friendly environment to boost investor confidence.
 Enhancing private and public sector savings by cutting con sumption to create space for resources to fund investment needs.
 Devising mechanisms to tap in diaspora resources including issuing diaspora bonds to help close any financing gap.
Addressing diaspora investment challenges and creating a conducive and enabling environment that would attract diaspora capital into the sub-region 12.
The Central Banks believe that when these structures are firmly in place and institutions are working to deliver their best then together with sound pursuit of monetary policy actions, should help re -anchor inflation expectations, regain macroeconomic stability and restore investor confidence in the economy.
Let me, at this stage, now turn to the issue of the link between accurate reportage and financial /economic stability.
Permit me to draw a distinction between accurate reportage that comes from publicly available data and accurate reportage from non-publicly available information.
Since the media obtains information from various sources, it is important to keep this distinction in mind.
First, it is generally acknowledged that the behaviour of economic agents are influenced by both the economic and financial environment, which is largely shaped by the narratives of the media.
The media’s role in influencing the e conomic narrative is even more crucial during periods of heightened uncertainty.
Under such instances, the media has additional responsibilities to decide the timing of release and newsworthiness of the information at hand for accurate reportage.
As financ ial journalists, it is possible to come in contact with different information sets, some of which may be confidential and which, if published, could destabilise the financial system.
Financial journalists therefore have a responsibility to carefully weigh the implications for financial stability of information they intend to publish.
Workshops like this can help equip journalists like yourselves with the 6 | P a g e relevant knowledge of the financial sector and the nature of risks and incentives facing the sector.
The role of the press here is also critical and that is what I want to stress on.
We see the role of journalists as key facilitators on the transmission mechanism of policy actions.
Accurate reportage helps transmit policies quicker and monetary policy becom es efficient.
Time and again we in Africa have complained about weak transmission of monetary policy.
But we must know that there is a relationship between freedom of the press and transmission of monetary policy action and an educated population.
A free press operating in an environment where data is easily assessable if more efficient and supports transmission of policy actions to the economy in an efficient manner.
I see the press as that strong salesman selling the policy to provide confidence to drive economic activity and growth.
This is who you are as a group and you must live by these ideals.
And so your role is crucial for monetary policy and we at the Central Bank view this program as very important.
Ladies and Gentlemen, as an inflation -targeting central bank , the Bank of Ghana views transparency as key in promoting credibility of the Bank’s policies.
Transparency is possible when a ccurate reportage informs the public of the exact nature of developments in the economy as well as the real implications of actions taken by policymakers.
Engagements with stakeholders also foster the creation of an informed public, whose accurate grasp of economic and financial issues are important in ensuring the seamless functioning of the economy.
Before I end, I would like to extend the Bank’s gratitude to Ecobank for its commitment to improving the quality of financial journalism in Ghana by sponsoring this training workshop.
Together with the Bank, we can build a critical mass of financial journalists capable of accurate reporting on Ghana’s emerging vibrant financial markets.
BUSINESS & FINANCIAL TIMES GHANA MONEY SUMMIT 2022 THEME: AFRICA’S ECONOMIC GROWTH – FACILITATING INVESTMENT, PAYMENT AND SETTLEMENT SYSTEMS MRS.
ELSIE ADDO AWADZI 2ND DEPUTY GOVERNOR, BANK OF GHANA MARRIOT HOTEL 26 APRIL 2022 The Chief Executive Officer, Dr.
Godwin Acquaye Management, and Staff, of The Business and Financial Times Distinguished Speakers and Panelists Invited Guests, Ladies and Gentlemen Friends from the media Good Morning.
It is a pleasure to join you today as Keynote Speaker at this year’s Money Summit under the theme, ‘Africa’s Economic Growth – Facilitating Investment, Payment, and Settlement Systems’ .
Permit me to tha nk Business & Financial Times (B&FT), the organizers of this Summit for their kind invitation to Governor Dr.
Ernest Addison who would have loved to be here himself but for an equally important national assignment he is currently undertaking.
The Bank of Ghana commends the B&FT for organising this important summit, consistent with its commitment over the years to provide a platform for rich stakeholder dialogue on matters that affect Ghana’s socio-economic growth and development.
We commend you further for taking the discussion to an African regional level, given the importance of regional initiatives for the times in which we are.
Ladies and Gentlemen, the African continent is the world's second-largest and second-most populous continent with over 1.3 bil lion people only after Asia, accounts for about 16% of the world's human population and covers about 20% of the world’s land area.
It is also endowed with vast deposits of natural resources including diamonds, gold, silver, iron, cobalt, uranium, copper, bauxite, oil and gas, as well as land, sea, and climate resources that produce rich cash crops such as cocoa, timber, and other trees, tropical fruits , food and other items , mostly exported to foreign markets.
Notably, the continent is a diverse grouping of low, lower-middle, upper- middle, and high -income countries, with mixed economic histories and growth prospects.
Before the onset of the COVID -19 pandemic, the International Monetary Fund (IMF) estimated in its Regional Economic Outlook for sub -Saharan Africa in 2019, that economic growth would remain strong in non - resource intensive countries (some 24 countries with a population of about 500 million people) averaging about 6 percent with per cap ita income rising faster than the rest of the world.
In contrast, growth was expected to slow down in resource -intensive countries (about 21 countries) with per capita growth lower than the world average.
Overall, the average economic growth rate in sub-Saharan Africa was 3.5 percent in 2019, 0.5 percentage point higher than the previous year, and was projected to rise to 3.6 percent in 2020.
The IMF also estimated in 2019, that more than 70 percent of the countries in the region were in the bottom half o f countries globally in terms of competition indicators.
Firm risk markups in sub -Saharan African countries were about 11 percent age points higher relative to those in other emerging market economies and developing countries, reflecting the perceived weak competitiveness of the business environment.