The Ghana Investment Promotion Center (GIPC) has rejected calls to prevent foreign businesses from repatriating all their funds in foreign currencies out of the country, after making profits.
Proponents of the suggestion have argued that such a move will prevent the cedi from falling rapidly in value against foreign currencies, particularly the dollar.
But reacting to the issue on the sidelines of “The Money Summit,” GIPC Chief Executive, Yofi Grant, warned that such a policy could be counterproductive and deter investors from coming to Ghana.
He argued that investors are very sensitive to rigid economic environment; hence any move to control their finances could compel them to look elsewhere to invest.
“If you invest in for example in Togo, and the Togolese government holds your money and says you can’t take it outside, how will you feel? Will you even go there to invest in the first place?” he asked.
Proffering some solutions to the cedi depreciation, Mr Grant advocated a system that will build confidence in the Ghanaian to invest in Ghana and expand their operations across the continent.
“This is why the Akufo-Addo government has brought brilliant initiatives like the Planting for Food and Jobs, One District, One Factory project ; among others to grow local investors and businesses here in Ghana” he said.
He is optimistic such government policies will yield positive results in the future, encouraging young people to venture into agriculture.
“In the past we have been importing everything. High import is the main reason for the cedi depreciation. But with time, if we continue with these initiatives we are going to produce what we consume and the currency will be stable,” he stressed.
Taking her turn to speak at the event, the Second Deputy Governor of the Bank of Ghana, Elsie Addo Awadzi has reiterated the need for concrete steps to be taken to expand production and delivery of goods and services to promote regional trade and growth under the African Continental Free Trade Area (AfCFTA).
According to her, this will help accelerate the progress of the implementation of the AfCFTA Agreement and promote Africa’s inclusive growth and sustainable development in the context of cross-border payment system.
“Intra-regional trade presents another big opportunity for the continent’s economic growth prospects, which must be fully activated. The African Continental Free Trade Agreement (AfCFTA) creates for the first time, a single African market for goods and services, that transcends the boundaries of each of the continent’s 54 nations. With trading under the regime having commenced in January 2021, concrete steps need to be taken to expand production, delivery, and payment channels to promote trade, investments, and growth,” she said.
She also called for a more integrated solutions approach to tackle the inherent frictions in cross-border payments in Africa.
“Trade volumes under the AfCFTA will be driven to a large degree, by investments that will help to expand production and processing capacity in key value chains, develop key infrastructure to support the logistics of delivery of goods and services and payments, promote access to efficient and deep financial markets. Also critical will be investments in human capital and digitalisation, and the strengthening of business law regimes to promote investor confidence,” she added.