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NewsDr Mohammed Amin 'boasts' of slow rate of cedi depreciation this year

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Dr Mohammed Amin ‘boasts’ of slow rate of cedi depreciation this year

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Finance Minister-designate, Dr. Mohammed Amin Adam, has observed a slower rate of depreciation for the Cedi this year compared to the previous year.

Despite recent pressures on the local currency, Dr. Adam highlighted that the Cedi’s depreciation year-to-date stands at 12%, significantly lower than the 27% depreciation recorded in the same period last year.

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Speaking at the opening ceremony of the 2024 3i Summit in Accra on Monday, May 13, Dr. Adam reassured Ghanaians of the government’s commitment to curbing the depreciation of the Cedi.

He emphasized that measures are being implemented to address the challenges facing the currency. Dr. Amin urged Ghanaians to maintain confidence in the government’s efforts, assuring them that steps are being taken to stabilize the currency for the benefit of all citizens.

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“For this reason, Ghana’s economic rebound has been quite swift with economic growth ending the year 2023 at 2.9% against a target of 1.5%, inflation heading towards the year-end target of 15%, and interest rates declining. Despite recent pressures on our currency, the cedi’s depreciation year-to-date of 12% is far lower than its depreciation of 27% in the same period last year,” he said.

Dr. Adam highlighted that the government is implementing fiscal measures to address economic challenges. One such measure involves accelerating the disbursement of nearly $1 billion by development partners between now and December this year. These funds are intended to provide crucial support to the economy during this period of uncertainty.

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“As we convene at the 3i Africa Summit in Ghana, it is incumbent on us to acknowledge the remarkable strides that Ghana has made in nurturing a vibrant fintech ecosystem. Ghana’s fintech sector boasts of a diverse array of startups, accelerators and regulatory initiatives, solidifying our position as a front-runner in fintech innovation across the continent.”

“I commend the Bank of Ghana for being proactive in establishing a regulatory framework conducive to fintech innovation, exemplified by initiatives such as the Payment Systems and Services Act, Act 987 and establishing a Fintech and Innovation Office. These efforts affirm our commitment to fostering innovation while safeguarding consumer interests and preserving financial stability.”

“I want to take this opportunity also to acknowledge the many incubators across Ghana, including the Ghana Tech Lab and MEST Africa, that provide invaluable support to fintech entrepreneurs through mentorship, financial backing, and networking opportunities.”

As of Monday, May 13, one US dollar averages GH¢14.5 according to reports. Analysts foresee a continued weakening trajectory of the local currency, given the substantial disparity between foreign exchange demand and supply.

However, they anticipate improved liquidity conditions towards the end of the second quarter of 2024 after the International Monetary Fund (IMF) board approves the second review of Ghana’s program. This approval will lead to a tranche disbursement of US$360 million under the IMF program.

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