The Governor of the Bank of Ghana, Dr. Paul Acquah, has described the economic activity in the first quarter of the year as robust, in spite of the ongoing load shedding exercise.
He said that the first quarter showed significant growth in imports and exports and strong corporate performance while the bank's Composite Index of Economic Activity at the end of the quarter was up by 1.8 per cent and attributed it to employment, exports, commercial bank credit, imports and tourism.
He however noted that there were declines in port activities like cement sales and electricity consumption. Presenting the Monetary Policy Committee report for the first quarter in Accra yesterday, Dr. Acquah said the country's current debt stands at 2.7 billion dollars and added that total merchandise exports at the end of March amounted to 1,044.8 billion dollars which was an increase of 12 per cent over the fourth quarter of last year.
Total imports at the end of the quarter, he said, amounted to 1,822.71 billion dollars, a growth of 15.8 per cent over that of the first quarter of last year. "Crude oil imports amounted to 415.43 million dollars, about 24 per cent above the 379.79 million dollars recorded in the first quarter of 2006, reflecting an increase in volume, as the average price declined by 6.7 per cent," he said, adding that the country's trade deficit narrowed from 842.25 million dollars in the fourth quarter of last year to 778.63 million dollars at the end of the first quarter of this year.
The country's external current account he said, recorded a deficit of 482.8 million dollars compared to a deficit of 181 million dollars before debt relief recorded in the first quarter of last year. On the 2007 budget, Dr Acquah said, provisional banking sector data on its implementation indicates that total receipts for the first four months of 2007 amounted to ¢14,402.7 billion. He said total revenue and grants amounted to ¢10,758.9billion and total payments for the first four months of 2007 amounted to ¢15,962.7 billion, all of which resulted in a deficit of ¢1,560 billion.
The governor said headline inflation continued to be stable on its downward trend but showed an up-pick in April to 10.5 per cent due to unusual increases in food prices attributed to supply conditions. He said the BoG has formally announced the adoption of an inflation targeting framework measuring inflation as its principal variable for tracking underlying inflation in the country. He said the monetary policy committee has decided to keep the prime rate unchanged at 12.5 per cent as the risks in the outlook are well balanced.
The Governor said the total assets of the banking industry rose by 41.6 billion per cent to ¢56,275.7 billion over the year to March 2007 compared to 24 per cent a year ago. "Net loans and advances increased by 58.1 per cent to reach ¢26,354.7 billion in March 2007, compared with 41.8 per cent for the preceding year," he said. He said the quality of the banking industry's loan portfolio improved while non performing loans ration declined to 6.9 per cent from 7.9 per cent in December, last year.
Dr. Acquah noted that the country's reserve money broadly declined at a somewhat more rapid pace in the first quarter of the year.