According to Vice-President Dr. Mahamudu Bawumia, Government is planning to fix exchange rate at ports for a six-month period to ensure that importers and the business community will no longer have to worry about the impact of the cedi’s instability on the cost of doing business.
This will ensure that the exchange rate at which goods are cleared at the ports can only be reviewed after every six months – will promote predictability, price stability and proper planning for businesses.
The vice-president said the decision has become necessary owing to a review of numerous complaints received by the Economic Management team he leads.
“We have been reviewing whatever is going on at the ports on a regular basis to see where the issues are, what issues people are complaining about, and what we can do to make things better. One of the areas that we have received complaints from the Economic Management Team level about is the regularity of changes in the exchange rate every Monday at the port; and that, for a lot of importers, is a bit destabilising because you may import your goods and the exchange rate is ‘A’ and by the time you realise it’s ‘A plus something’ – and then your calculation of the duty you should have paid suddenly changes; that can be destabilising,” he bemoaned.
AGI welcomes proposal
Reacting to the announcement, AGI’s President, Dr. Yaw Adu-Gyami, described it as “very laudable”, adding that it will not only help businesses to plan but represents a huge incentive for investors to want to come and do business in the country.
Asked by theB&FTwhat the fix six-month exchange rate at the ports will mean for the association and entire business environment, he said: “What it means is that now if you are importing goods and the dollar rate is GH¢5, you already know that for the next six months when I bring 100,000 goods in, I am supposed to pay this amount as duty. So, it is really going to be helpful.”
Unlike the current situation, wherein every week or every Monday the price of a cedi to a dollar changes at the port, which has always been a point of dissent for businesses. The AGI president added that the new regime, if implemented along with other measures, will help local industries which are dependent on imported raw materials to be competitive.
“It will help importers to plan ahead in terms of duty. It is not only going to be good for importers, but I think it is also going to be good for the entire economy, including the consumer,” Dr. Adu-Gyamfi further noted.