Bank of Ghana (BoG) Governor, Dr. Johnson Asiama, has highlighted the vital role played by Ghana’s international reserves in protecting the nation’s economy from recent global turbulence. Addressing Economics students from the University of Ghana and the University of Ghana Business School during “Time with the Governor,” Dr. Asiama reflected on the country’s response to mounting external pressures, particularly those stemming from tensions in the Middle East.
“In the past three to four months, we have faced significant challenges with our international reserves,” Dr. Asiama noted, referencing a US$1.2 billion decline that saw Ghana’s reserves fall from US$14.1 billion to US$12.9 billion, according to the latest Bank of Ghana data. “I am therefore not surprised that we lost 1.2 billion reserves.”
Despite the losses, Dr. Asiama credited last year’s strategic decision to build up reserves as a crucial buffer. “One of the good things we did last year was to build some high reserves for interesting times like this,” he told students attending the 131st Monetary Policy Committee meetings as part of the MPC Educational Observership Programme.
He explained that the reserve build-up has given the central bank the flexibility to respond to global economic shocks and continue supporting critical sectors. “Managing the impact of external shocks involves difficult choices,” Dr. Asiama said, emphasizing the importance of strengthening Ghana’s foreign exchange earnings.
Looking ahead, the Governor called for increased focus on cocoa and non-traditional exports as drivers of reserve growth. He revealed that non-traditional exports currently make up about 10% of total exports but should be pushed to 15%.
Dr. Asiama also identified remittances as a potential avenue for bolstering reserves and economic development. He urged that more of the over US$8 billion received annually through remittances be directed into productive investments rather than consumption.
As Ghana continues to navigate a challenging global environment, Dr. Asiama’s message was clear: prudent reserve management and strategic export growth are essential to safeguarding the country’s economic stability.
Source: Apexnewsgh.com