CIB welcomes BoG’s reforms over commodity proceeds

The Chartered Institute of Bankers (CIB) has welcomed moves by the Bank of Ghana to surrender portions of proceeds from cocoa and gold directly to banks.

The move which is to take effect from the second half of the year is to deepen the foreign exchange market and promote its smooth functioning.

Previously, the Central Bank was taking all the proceeds from the sale of these commodities and selling to the banks in the form of foreign exchange. The decision to direct the export earnings on cocoa and gold to commercial banks forms part of a four-stage process to liberalize the foreign exchange market to make it easier for companies to access foreign currency.

President of the CIB, Clifford Duke Mettle, is optimistic the move “will ensure that foreign currency is moved gradually to banks for use by those who need it.”

Mr. Mettle, who is also the Director of E-Banking, Products and Marketing at uniBank said the reform when implemented would boost the export drive of the various banks.

“When they see the funds coming in, they’ll also now start to look at their programmes so that the export drive is followed through. Banks which do not have export programmes will now start looking at schemes to help the country’s export in general”.

Some watchers of the economy, however, fear the reform would not benefit relatively smaller banks since they may not have the strong client-base to take advantage of this.

But Mr. Mettle disagrees saying, it is an opportunity for such banks to develop expertise in that area, if they lacked it, since “these commodities bring in lots of proceeds”.

He also believes the Bank of Ghana would ensure there is fairness in the distribution of the proceeds when the reform comes into force.