Encourage Investments That Lead To Diversification

          Dr Paul Acquah, Governor of the Bank of Ghana

The Governor of the Bank of Ghana, Dr Paul Acquah, has charged governments in the sub-region to encourage investments that will lead to the diversification of their economies and provide safeguards to the vulnerable segments of the society.

He noted that it is only such investments that will maintain macro-economic stability in the midst of the global financial crisis.

Dr Acquah made the suggestion in an address read on his behalf at the opening of a five-day regional forum on the global financial crisis for 35 selected parliamentarians from Ghana, Nigeria and Sierra Leone. The Gambia and Liberia, in Accra, yesterday.

The forum, which is being organised by the West African Institute for Financial and Economic Management (WAIFEM), is to acquaint the legislators with the fundamental causes of the global crisis and the effects on the economies in the sub-region.

It will also build and strengthen the capacity of the participants to assess, monitor and evaluate stimulus packages in the annual budgets and deepen their understanding of monetary and fiscal options to insulate African economies from the harsh effects of the crisis.

Dr Acquah, whose address was read on his behalf by the Head of Research of the Bank of Ghana, Mr Lawrence Nketiah, noted that maintaining macro-economic stability is critical to ensure that the domestic economy remains attractive to both domestic and foreign investors.

'The challenge is how to sustain stability and mitigate failing domestic demand within the constraints posed by the increasingly scarce external inflows,' he said, explaining that 'must be done in the context of implementing policies consistent with medium-term stability and development goals.'

He called for enhanced vigilance and interaction with the domestic financial system to ensure adherence to supervisory guidelines to enhance bank.

Dr Acquah stated that while legislators cannot contain the global crisis, they can play a role in ensuring that the financial systems contain the right incentives and are properly regulated.

He added that the legislators can play a critical role in ensuring that the effects of the crisis on economic growth and poverty in the sub-region are limited to the extent that the current crisis does not undermine the improvements that have been made over the years.