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Our foreign exchange scheme is too weak; time to tighten it

Our foreign exchange scheme is too weak; time to tighten it

Dr. Mahamudu Bawumia, Ghana’s Vice President, has admitted that the country’s foreign exchange systems appear to be inefficient.

This, he believes, has contributed to the country’s current economic challenges.

He maintains that the government and key stakeholders must consider tightening the foreign exchange regime by reconsidering innovative production methods.

Speaking at the Standard Chartered Digital Banking Innovation & Fintech Festival in Accra, the Vice President stated that the government will present details on how to address the exchange rate shortfall in the coming days.

“It is clear that our foreign exchange regime is quite lax, which is why we are going to look into ways to tighten our foreign exchange regime.” In broad terms, the current economic situation cannot be addressed without addressing fiscal and debt sustainability, production, and the foreign exchange regime.”

Dr. Bawumia emphasized the significance of major policy changes following a deal with the International Monetary Fund (IMF).

“Once those [negotiations with the IMF] are completed, it will be clear that it will not be, and should not be, business as usual,” the Vice President said.

For one thing, he stated that the nature of production must change because Ghana has more trade surpluses and current account deficits, “which means that a lot of the foreign exchange that we earn from trade does not stay in Ghana.”

Also read: Bawumia tells Commonwealth Judges to embrace digitalization

Vice President Bawumia stated that Ghana would work to reduce import dependency in order to address the country’s currency problems.

Ghana’s currency has been identified as one of the primary causes of inflation during the current economic crisis.

Vice President Bawumia also said that the President will address the nation soon, during which the government’s plan “will be fleshed out in specifics.”

“More importantly, if we are to address this, we must digitalize the economy,” the Vice President added.

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