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Business News of Saturday, 1 February 2014

Source: myjoyonline.com

Ghana’s high-rise buildings causing fall of cedi - Amaliba

The sharp fall of Ghana’s currency, the cedi, is largely due to the imposing high-rise buildings scattered around; a member of the National Democratic Congress legal team, Abraham Amaliba has diagnosed.

Buttressing his submission on Joy FM/MultiTV’s news analysis programme, Newfile
He mentioned specifically magnificent edifices he said are near the house of former President John Kufuor, close to the Tetteh Quarshie Interchange in Accra to back his claims.

“Look at the mansions near Kufuor’s house...they are coming up, they are now reaching the sky,” he submitted.

The panel on the show were discussing the continuous depreciation of the cedi against major currencies such as the dollar and pound.

“The cedi is rising, for me, basically because of the high rate of development that we are experiencing now. This high rate of development can be seen in private and public mansions coming up everywhere, and the fact that we have to import all these materials so as to be able to put up these buildings,” Abraham Amaliba indicated.

He also mentioned the expansion works at Takoradi and Tema Harbours, as well as other infrastructural works such as roads being constructed by the government as a contributing factor to the cedi’s nosedive.

“These developments go a long way to affect the cedi,” he intimated.

Earlier, Managing Editor of the New Crusading Guide newspaper, Malik Kweku Baako assessed that, “though development comes with some expenditure, we also agree that the elements of physical and monetary indiscipline in the economic management” could be a reason.

According to him, the “huge unprecedented physical deficits” recorded by the government in recent years have had “adverse effects on our economic health”.

Rejecting the accolade of a prophet of doom, and taking a realistic stance, Mr Baako downplayed the effect of 20 million dollars pumped into the system by the Central Bank to ease the pressure on the cedi. He predicts: “A year from today, they will pump 40 million [dollars] to try and rescue the cedi.”

But Dr Omane Boamah, Minister of Communications, countered Mr Baako’s assertion, pointing out that the deficits were not spent on “frivolous things”.

He cited numerous road projects and other infrastructural development in the energy sector as some of the projects the monies were used for.

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