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The Chief Executive Officer of the Ghana Association of Bankers, John Awuah, has called on the government to instill confidence in international investors through policy credibility.
According to him, the international community has been keeping a keen eye on the government’s actions and is reacting in accordance with what it sees.
Speaking on JoyNews’ Newsfile Saturday, he stated that when the Finance Minister announced the government’s decision to reduce its budget expenditure by 20% there was an instant response on the international market.
“On that day, Ghana’s bond traded favourably which means that the global business community is watching us. Unfortunately, when that statement came, we did not do a follow-up statement.”
He noted that what was expected of the government was to give a detailed breakdown of how exactly the government was to implement the 20% budget expenditure cut.
“What the business community was expecting was ‘okay so 20%, what are the cost items that are going to be touched?’ in my view as a finance professional, you can’t say a blanket 25% across the board on all discretionary spend.
“There is going to have to be a certain cost line being 100% cut off, others maybe 10% and other cost elements 50%, others 15%, 2% here, I mean all together perhaps will give you the average of 20% the Minister talked about. We need to bring confidence and policy credibility to the table. That is what the international market is watching,” he said.
He added that the government has been too quiet about its fiscal policies thus causing doubt in the international community.
“Why we’re getting punished is that we have gotten too quiet for too long. When you’re in crisis you have to be seen doing something and that which you’re doing should be visible. People must know what is happening,” he stressed.
Source: myJoy
