Borrowing dollars to cushion the cedi is not a sustainable venture

Borrowing dollars to cushion the cedi is not a sustainable venture

News of the dollar coming in to strengthen the economy has been welcomed by the Director of Research of the Institute of Economic Affairs, Dr John Kwakye.

However, he said that the government is supposed to do more to address the fundamental and structural challenges the economy is grappling with.

He reiterated during an interview on TV3 that Ghana as a country needs to look at how to earn foreign exchange on its own to strengthen the economy.

Mr Kwakye’s advice is coming on the back of the assurance of Information Minister Kojo Oppong Nkrumah that there will be a lot of dollars coming in to strengthen the Cedi.

According to Mr Oppong Nkrumah, a US$750 million Afrieximbank loan and also US$1.3 billion from the cocoa syndicated loan that will push the total to US$2 billion will soon be infused into the Ghanaian economy to stop the depreciation of the Cedi.

The legislator for Ofoase Ayirebi blamed the depreciation of the cedi on some external factors such as the repatriation of funds and assured that the Bank of Ghana instituted some measures to deal with the depreciation of the Cedi. 

He also highlighted some other measures that were put in place to save the ailing economy. “We need to cut down on our import bills significantly. We are importing rice, chicken, fruit juices, there needs to be clarity on what we need to do to reduce the importation, and those are some of the things that are being done”. 

Responding to these measures the government have adopted, Dr Kwakye said “Every amount of dollars that comes will help in stabilizing the Cedi”.

He said that though injecting $2 billion into the economy will help in the short term but in the long term, he stressed the important thing is to address the structural problem to earn foreign exchange.

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