Ghana lowest in savings in Sub-Saharan Africa

Ghana is currently rated among one of the lowest savings countries in sub-Saharan Africa.

The country has been ranked 8%-12% compared to the 25 percent average.

Finance and Economic Planning Minister, Kwadjo Baah who made this known during the launch of the Golden Jubilee Saving Bonds in Accra sees this as an impediment to rapid economic growth and development that the country expects to achieve.

He however noted “Ghana’s ability to increase the savings rate depends on factors with the development of new saving products which is the golden jubilee saving bond intended to promote a saving culture among Ghanaians and also support the significantly higher levels of investment needed to propel the country into middle income status by 2015".

According to him, the launch of the golden jubilee saving bond serves as a call to Ghanaians in the Diaspora to channel their resources towards the country’s development and their individual interests.

This, he said should encourage recipients of remittances to save.

The ‘Actionman’ said this will enhance the development of Ghana’s financial market through the introduction of a savings bond with new features.

The golden jubilee savings bond will be compounded semi-annually to provide long term investors with above average returns.

It has also been designed for Ghanaians to participate in the formal financial system to promote long term savings and investment culture in the country.

The Finance Minister noted that government has decided to apply the proceeds of the golden jubilee bond to a significant and lasting infrastructure project in each of the 10 regions of Ghana.

This, he said provides opportunities for all Ghanaians to own a stake in the nation’s development use of their investments through the manifestation of developmental projects in each region.

To commemorate the golden anniversary celebration of Ghana’s independence, the government of Ghana (GOG) has planned to issue the jubilee Bonds from December 2007 to promote savings habit among ordinary Ghanaians.

Raising an amount of GH¢50million for investment in infrastructure project in commemoration of the Golden Jubilee, the GOG through the ministry of finance and economic planning(MOFEP) appointed Strategic African Securities as Issues Manager, Law Fields consulting as Legal Advisors, and Lowe Lintas Ghana as Public Relations advisors for the jubilee bond.

The Ministry of Finance and Economic Planning together with the Bank of Ghana brought up the idea of diversifying the financial instruments on offer to the market of the country with the introduction of the Golden Jubilee Saving Bonds to enable Ghanaians both home and aboard to participate in the investment product with as little as GH¢10.00 and benefit from the extremely attractive interest rates.

Jubilee Bound can be used as tax exempt and also as collateral.

With GH¢10 as the face value for the bond, interest is set as 14 percent and would correspond with the five years government bond.

It is opened to cooperate and individual investors.

That notwithstanding, management says it is much more focused on individual investors.

The whole idea of the bound is in to two fold, raising infrastructure in each region in conjunction with the fifteenth anniversary and also encourage savings among Ghanaians.