Minister of Finance and Economic Planning, Seth Tekper has proposed the establishment of a ‘development bank’ which is deep enough to go into long term financing, and mortgages. The establishment, according to the Finance Minister, should not be necessarily state- owned.

He was speaking an economic forum organized by Graphic communications this morning.  Setting the background to kick start the discussion on the back of current economic crisis and the way forward, Seth Tekper indicated that Ghana is a country in transition and needed to get the policies right to move it forward.

According to him the volatilities the country is experiencing is having both negative and positive impacts on the economy. To many people, he said,  "Ghana is on the periphery and considered as an emerging market". He thus admits "we need to manage the volatilities well, and so far we are getting better at it".

Reffering to  works on the West Africa Gas Pipe Tekper warns that a breach on gas pipeline could have adverse effects.  He also advised that the economy must continue value addition, eg processing gas and empower industrialization.

He acknowledged that since the service sector is the largest contributor to our GDP, he agrees with the assertion to ‘create Accra as a hub for transportation and financial services where international and domestic capital will be found’ among others.

ISSUING OF BONDS

Untill the issuing of bonds on the international markets begun last year,  Seth Tekper said treasury bills remained the  most reliable source of financing from the budget because of the high interest rates it yielded. 

Going forward he said the country should be thinking of a development bank not necessarily state owned. He perceives this as a challenge for the financial market to consider.

He explained that "Ghana should also think of an Exim approach; that is the only way to go to boost exports, to save our current accounts situation".  The option he believes will bring the economy under control and free it from the volatilities it is experiencing.

"We also need a stock exchange,(not the equity capital kind), that will lead us to corporate bonds, that will partner with other international stock exchanges within the w/a environment, to provide long term financing, bonds, equity and others so that we can move", he added.

Again he suggested that the need to build institutions such as the private sector equivalent as is being attempted with small holder scales. For example, according to Seth Tekper "COCOBOD is nothing more than an aggregator for peasants farmers who led this country to become the first leading producer of cocoa and now second; the assurance they have is that COCOBOD is an off taker and COCBOD and its agencies , part of it now which is now privatised".

He said this has to be done for the private sector to come in with warehousing and other schemes to develop, so that when government puts in the irrigation schemes to do the off take, the schemes do not break down again.  "We need off takes from warehousing to agro processing to exports", the emphasized.  This initiative according to Seth Tekper ties in with what President OBAMA posited; that we do not just need leaders but also institutions.

He urged that the nation must also continue with is millennium goal aspirations, otherwise we will become a rich country but leave a large sector of the population behind.

We should be an economy that grows its financial and real sector which creates jobs so that graduates that we are producing will find jobs.  Then the macro-economic stability that we desire will be realised