Africa`s banking sector resilient…despiate global financial crisis
Even though the effects of the challenging global meltdown has had severe consequences on low income economies, the impact, through the financial sector has been quite slow, because of a weak integration with the global financial market, the Central Bank of Ghana has observed.
According to the Governor of the Bank of Ghana, Dr. Paul Acquah, the slow reaction in these economies of the region, was largely due to the fact that low economies have limited exposure of their economies to toxic assets that have precipitated, and also spread the crisis in the international financial systems.
“This limited exposure of the banking sector of the region, has enjoyed a relatively strong performance, which is supported by improved macroeconomic stability and legislative reforms, while resulting in the implementation of revised prudent guidelines and risk management frameworks,” he added.
The Governor of the BoG made these observations at the opening ceremony of a regional forum on the global financial crisis for legislators, which was organised by the West African Institute for Financial and Economic Management (WAIFEM), in Accra.
The countries participating in the forum include Ghana, Nigeria, Liberia, The Gambia and Sierra Leone.
However, the forum seeks to strengthen the capacity of legislators to play their roles more effectively in enacting appropriate legislation geared towards the realisation of national development goals, within the current globalised economic environment.
Dr. Acquah noted that as the financial crisis continue to deepen, the region would be witnessing a fall in export revenues, declines and reversals in capital flows in stock, and money markets fuelled by speculative and increased volatility on foreign exchange markets.
The Governor predicted that such external shocks would be creating budget crises in developing countries, as the low fiscal and current account deficits, created through the long period of successful reforms, were now being widened.