President John Mahama has stated that both the Exim Bank and the Ghana Infrastructure Fund (GIF) will form a new growth trajectory in the economy for generating jobs and creating incomes.
He is optimistic that the establishment of an Exim Bank to finance and guarantee exports will diversify Ghana’s export base and reduce the recurrent shocks from Ghana’s dependence on commodities.
“As with the Exim Bank, the Ghana Infrastructure Fund was established for a similar purpose.
These institutions combined will serve as buffers for managing the economy, while providing the space for spending on social economic infrastructure,” he said.
The Ghana Exim Bank and Ghana Infrastructure Fund, Mahama claims, are some of the more enduring and independent mechanisms for addressing the root causes of macroeconomic challenges.
According to Mahama, over the last few years government has taken steps to address cracks in the economy, which involved “diversifying the economy by intensifying value added additions to exports”.
He explained that operations of the Exim Bank will support the nurturing and growth of the private sector in Ghana, and address the problem of access to credit and long-term problem of export.
An Exim Bank bill is currently before parliament and the country is now pushing for a law that will help it to establish an Export and Import Bank aimed at transforming the local economy into a strategic position as an export-led economy.
It is expected that the Bank will operate as a quasi-government institution that acts as an intermediary between the national government and exporters to issue export financing.
Mahama is now eager for the bill to be passed in order to address macro challenges: “I intend to sign it into law as soon as this House passes it, because it will underscore Ghana’s story of transformation.
“Our second strategy has been to invest heavily in building transformative infrastructure.
As an emerging middle-income country with a new growing middle class, this will form the basis for a growing trajectory, creating jobs and generating incomes. In furtherance of this, it was decided to create strong institutions to achieve our goals,” the President added.
He said his administration has additionally deployed a new debt management strategy that includes the need for commercial projects to pay for loans that are procured to complete such projects.
“It will also enable the country to take advantage of international trade initiatives such as the African Growth and Opportunity Act (AGOA) and Economic Partnership Agreement (EPA).
“It will also operate as a non-deposit bank that assists exporters to compete internationally by providing insurance and finance facilities to support their overseas activities,” he said.
Chairman of Parliament’s Finance Committee, James Avedzie, said establishment of the Ghana Exim Bank will create a strong institution that consolidates past efforts and becomes the “key engine” for developing Ghana’s export activities.
Source: B&FT Online