IMF, EU Funding Can't Stop Cedi Fall – Andani

Stop-gap measures announced by Government based on pledges by the International Monetary Fund (IMF), the World Bank and the EU to stop the depreciation of the cedi against major foreign currencies are not going to yield any significant results, Managing Director (MD) of Stanbic Bank, Alhassan Andani, has indicated.

Speaking in an interview with the media in Accra after the bank donated two cheques totaling GH¢152,000 to the Korle Bu Burns & Plastic Surgery Centre and the Cardiothoracic Centre recently, Mr Andani said it behoves Government to make conscious effort to increase the volume of exports from Ghana to bolster the country's trade balance instead of relying on mere promises.

'What we hear is that IMF and others will give us money. That is not how to stabilize the cedi as these are all temporary,' he mentioned.

Government has hinged its hopes on some $20 million promised by the IMF and the EU to stop the free fall of the local currency.

Since the beginning of this year, the local currency has lost over 30 percent value to the major foreign currencies. In 2014, it suffered a 32 percent cumulatively.

The ongoing power outage, also known as Dumsor, is negatively affecting local companies in the country.

The development is likely to compel foreigners, who are running businesses in the country to engage in capital flight.

Some leading economists in the country have criticized government for failing to strength the cedi.

The Central Bank has since started pumping more dollars into the system to help halt the free fall of the cedi, but the effect of this activity is yet to be felt by all in the country.

By Samuel Boadi