The Finance Minister, Ken Ofori Atta, has revealed that government has so far injected over GH¢8 billion into the banking sector to stabilise the crisis facing the sector.
He indicated that government had no other option than to pump the amount into the sector to save most banks from collapsing and also secure the deposits of about 1.2 million people.
Speaking at a stakeholders engagement on the 2019 budget in Kumasi on Friday, the Finance Minister explained that government’s intervention was necessary because the ripple effect could see many companies going down, and jobs being lost.
About 1700 jobs were directly lost when the Bank of Ghana withdrew the licences of five commercial banks and merged them into a newly established bank – Consolidated Bank of Ghana – in August. Prior to that, two banks had suffered the same fate when their assets were taken over by the GCB in 2017.
“True we have lost some jobs in the banking sector, but the consequences of not intervening would have been quite clear to all of us,” the Finance Minister remarked.
Meanwhile, Mr Ken Ofori Atta has said government intends to make the 2019 budget transparent and participatory as possible.
“2019 must be a budget that represents our deeper aspiration as to where we want the country to go…at least the next two years we should be clear in where we are going.”
Commenting on the challenges facing the cedi , he said, the strengthening of the US economy has been the cause of the depreciation of the cedi.
He indicated that had government not done remarkable work on the economy, the situation would have been worse.
Ken Ofori Atta conceded that the journey has not been easy since the NPP took over power, but said it has been able to improve the economy.
“The economy grew by 8.5% in 2017 up from its ailing growth of 3.7 percent in 2016,” the Finance Minister pointed out, adding that by the end of 2017, the fiscal deficit had reduced from 9.3% at the end of 2016 to 5.9%, lower than the programmed target of 4.5 percent at the end of 2018.
“Inflation has come down from 15.4 percent to 9.9 percent, public debt has come down from 73 percent to 69.8 percent of GDP, interest rate has come down from 16.3 percent to 13.3 percent,” he touted.
“Government has been investing in agriculture, strategic infrastructure, human capital with deliberate push towards industrialisation with active private sector investment in order to create jobs and wealth”.
By Antwi Boasiako | 3news.com | Ghana