Gov't downplays 'gloomy' Economist's cedi projection

Source: Ghana| Myjoyonline.com |Abubakar Ibrahim |abubakar.ibrahim@myjoyonline.com
Date: 3rd-january-2018 Time:  1:49:02 pm

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Government has downplayed a gloomy projection by the Economist Intelligence Unit (EIU) the local currency, the cedi may hit GH¢6 to a dollar by 2022.

Deputy Information Minister Kojo Oppong Nkrumah says the administration is unfazed by the report because some measures have been put in place to avert such an occurrence.

He told Joy News Wednesday, the EIU report only cautioned the government of what may happen and explained what could make it happen. 

In its latest report, the EIU has predicted the cedi, which is currently trading at GH4.53 to a dollar, may suffer some depreciation by the end of 2018.

The report also predicted some political uncertainties in the lead up to the 2020 elections.

The EIU explained the poor outlook was necessitated by the fiscal policies being championed by the US President Donald Trump administration, which includes tax cuts.   

But the Deputy Information Minister said government is working to guard against the EIU's prediction.

He said the administration has what it takes to forestall the scenarios enumerated by the EIU as having the potential to scupper government's agenda.

Mr Oppong-Nkrumah said the current economic numbers show an improvement in terms of the country’s political risk insurance.

“Recently, even old transactions that were yet to be consummated have had to be reviewed downwards because our political risk insurance has improved following how we conducted ourselves in the last election,” he said.

He added that the country has proved that it has what it takes in the area of Balance of Trade and Payment, currency and will be able to control any situation.

“But the caution is good as it draws out attention to these things and ensure that we deliver and not fall into the risk the EIU is warning against,” he said.

There is a reason for cautious optimism as the EIU further predicts a stable cedi at the beginning of 2018.

This is attributed to the country’s oil revenues and the confidence drawn from a relationship with the International Monetary Funds (IMF).

Inflation is also likely to drop in 2018 due to the Akufo-Addo administration’s tighter fiscal policies in comparison to previous years. 

 

 

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