Dr. Ernest Addison, BoG Governor
The Governor of the Bank of Ghana (BoG), Ernest Addison, says the African continent must strategically position itself to take advantage of the opportunities the African Continental Free Trade Area (AfCFTA) presents.
In response to the opportunities that the AfCFTA presents, he noted that commercial banks are required to strengthen all risk management systems and scale-up capacity in trade finance to support the private sector.
He further encouraged banks and non-bank financial institutions to increase investments in digitisation platforms as well as cyber-security systems to facilitate safe and secure trade transactions through AfCFTA,
“These institutional developments should complement the PAPSS and MANSA platforms through which Afreximbank will work with local businesses and financial institutions to help facilitate intra-Africa trade,” Dr. Addison said.
During a session with the banking and financing community at the Ghana Trade Roadshow in Accra, the BoG Governor said that the trade constraints in Africa are partly linked to small, fractured, and partially-isolated markets.
“The effective implementation of AfCFTA would therefore be a giant step forward and the Agreement demonstrates Africa’s readiness to integrate into the global trade agenda. This would require commitment from all countries and all stakeholders,” he said.
Ghana’s role
Dr. Ernest Addison told the gathering that trade constraints in Africa are partly linked to small, fractured, and partially-isolated markets.
To this end, the effective implementation of AfCFTA would be a giant step forward and the Agreement demonstrates Africa’s readiness to integrate into the global trade agenda, he explained.
The BoG Governor, therefore, believes “the Africa Trade roadshow series is coming at an opportune time to help facilitate and create the enabling environment for trade for all stakeholders in the trade industry in Ghana.”
In his view, Ghana has a significant role to play in the integration of the financial system of ECOWAS saying the process includes capital market integration, regional currency convertibility/quoting and trading national currencies, harmonisation of the legal and regulatory frameworks of the banking sector, harmonisation of legislations and cross-border payments system integration.
“The implementation of these reforms would ensure the development of a robust financial sector in Ghana to participate in funding trade transactions presented through the AfCFTA platform,” Dr. Addison indnicated.
Leveraging AfCFTA
To the Governor, Ghana’s financial sector can play a pivotal role in leveraging AfCFTA to boost the country’s socio-economic development.
“This can be achieved through investments in infrastructure and financial technology to support regional trade transactions. These favourable conditions and Ghana’s position as the gateway to West Africa, among other factors, earned Ghana the right to host the AfCFTA Secretariat,” he said.
He noted that, currently, the country’s banking sector is well capitalised, with adequate liquidity to support transactions generated through increased trade adding that his outfit has also put in place robust regulatory and supervisory frameworks to support in-country and cross-border trade transactions.
“There are also policies and safeguards to reduce Anti-Money Laundering and Combating the Financing of Terrorism (AML-CFT) activities and create a robust and sound financial system to support regional trade. Ghana’s financial sector can therefore be instrumental in meeting the funding needs of businesses in the country to trade under the AfCFTA umbrella,” Dr. Addison said.
He, therefore, urged all financial institutions to collaborate and take advantage of the opportunities offered through AfCFTA to boost the country’s trade efforts
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