Financial sector looks promising - BOG Official

Accra (Greater Accra) 7 April '99

Developments in the country's financial sector during the first two months of 1999 appear promising. Inflation fell from 15.7 per cent in December 1998 to 15 per cent at the end of February while growth in money supply declined from 17.6 per cent in December 1998 to 17.2 per cent by February 1999, the first time in eight years. Dr Henry A. K Wampah, Head of Research Department of Bank of Ghana, said this at the opening of a three-day seminar on financial and economic reporting in Accra Tuesday. Dr Wampah said the country's monetary reserves recorded 4.5 per cent fall during the period and attributed it to a tight monetary policy adopted by the central bank. The BOG achieved most of its financial targets for 1998, he stated, adding: "1998 turned out to be one of the best years since the launch of the Economic Recovery Programme (ERP) in 1983." The Net Financial Asset (NFA) of BOG grew by 100 million dollars as against the target of 60 million dollars, money reserves increased by 16.8 per cent in 1998, compared with 33 per cent in 1997, and the cedi depreciated by four per cent in 1998 as against almost 23 per cent in 1997. He said 1999 looks promising and targets are attainable expressing the hope that inflation would continue to fall and the exchange rate would be stable. Dr Wampah said new instruments like standing orders and strengthening of liquidity forecasting would be introduced. A new BOG draft bill to strengthen the independence and supervisory authority of BOG is being considered by government. Dr J.K. Richardson, Chairman of the Board of Directors of Merchant Bank, said journalists have an important role to play in the development of the country. They should therefore avoid speculative reporting on financial issues since it has the tendency of creating panic that can affect the interest of the state. Dr Richardson called on the financial services sector to provide the necessary fuel needed for the growth of the private sector. Dr Chris Nartey, Managing Director, Merchant Bank Ghana Ltd, said the bank spent 100 million cedis on health, education and other sectors in 1998 as their social responsibility and pledged to do more. The seminar is being organised by the Institute of Financial and Economic Journalists (IFEJ) and sponsored by Merchant Bank, Ghana Limited. It is being attended by 25 journalists from state and private media organisations throughout the country.