The Governor of the Bank of Ghana, Dr Paul Acquah, has said that the central bank will continue with reforms and policy interventions to position the financial system strategically to translate the macroeconomic stability into accelerated growth.

He said the economy had to catch up and not lag behind the Asian Tigers such as Malaysia and Korea with whom Ghana started the development process at the same level at the same time 50 years ago.

“The financial sector is at a stage that it can begin to drive the private sector-led growth strategy to achieve the objective of a middle-income status and more,” the governor said at the weekend.

He was addressing members of the Chartered Institute of Bankers, Ghana, at their 2007 annual bankers dinner.

“A dynamic growth-oriented financial system must be strong, well capitalized and effectively supervised within a friendly regulatory environment in accordance with international best practice,” he stated.

Dr Acquah said as an emerging market, Ghana's economy must have the capacity and skills to properly assess and manage price risks as well as the capacity to manage capital flows to derive the full benefits.

He said in the last few years, the country embarked on a number of such reforms as the Banking (Amendment) Law, Act 738, the Foreign Exchange Act and the Anti-Money Laundering Bill which were just passed by Parliament. He said these were steps that would provide an enhanced regulatory and incentive structure to support a market-oriented economy.

The governor said the domestic capital market was also a vital pillar for the economy that needed to be developed to engender market discipline and an efficient allocation of resources.

He said in developing that market, the central bank was faced with the challenge of roping in the corporate sector in the capital market.

“In particular, the parastatals who command significant amount of resources must be re-engineered to shift from dependence on fiscal transfers and forms of subsidies and become reliant on the capital market based on the strength of their balance sheets,” Dr Acquah stated.

Specifically, the governor mentioned pension funds, insurance companies and social security to release some of the huge resources under their care and channel them to the capital market to provide “depth and liquidity.”

He said so far the five-year and 10-year government bonds were important policy interventions to provide a yield curve and benchmark for corporate sector activities.

Dr Acquah announced that Ghana's Eurobond, which raised $750 million had won the international award of the Overall Best Emerging Market Bond for 2007 as well as the Best Bond in Eastern Europe, Middle East and Africa.

The Managing Director of the Ghana Commercial Bank, Mr Lawrence Adu-Mante, who proposed a toast to the institute, called on banks and stakeholders to support the institute to educate professionals for the industry.

The President of the institute, Mr Isaac Owusu-Hemeng, who responded to the toast, said the institute was collaborating with the National Banking College to run courses accredited by the National Accreditation Board to satisfy all areas of the financial sector.

Fellowship of the institute was conferred on some personalities.

They included Dr Mahamadu Bawumia, First Deputy Governor of the Bank of Ghana; Mr Asare Akufo, the Managing Director of HFC Bank; Mr Lawrence Adu-Mante, Managing Director, Ghana Commercial Bank; Prof. Samuel N. Woode, the Chairman of the Public Services Commission; Prof. Cletus Dordunoo, an Economist, and Mr. Victor Kofi Agyapong, the Kumasi Branch Manager of CAL Bank.



Source: Daily Graphic