Cassiely Ato Forson in a press address said the depreciation of the cedi “will push up the cost of production, make domestic businesses less competitive”
The Minority in parliament has said the cost of doing business in Ghana will increase following the cedi depreciation.
According to them, the ramification will equally impact on GDP growth, inflation and servicing public debt.
The cedis has rebounded strongly throughout this week, selling around ¢5.3 cedis to the dollar on Tuesday after it depreciated from ¢4.9 to around ¢5.6 between February and March, sparking fears among the business community.
But the Minority is unimpressed with the rebound.
Addressing the press Wednesday, Minority Spokesperson on Finance Cassiel Ato Forson said, “domestic businesses which rely on imported raw materials will be compelled to pay more in cedi terms for their raw materials.”
According to him, this development “will push up the cost of production, make domestic businesses less competitive, and will eventually push them out of business.”
He further claimed that not only is the situation leading several businesses to fold up, according to them investor confidence is weaning too.
“As at end-year 2016, investors bought the dollar at an interbank rate of about 3.9 Cedi per Dollar, today, these same investors are compelled to buy the dollar at an interbank rate of 5.65 Cedis per Dollar.
“The depreciation of the cedi has overburdened investors with unexpected cost, as their cedi cannot purchase as much as before in the external market. This has reduced their capacity to expand their businesses,” the former Deputy Finance Minister said.
Information Minister Kojo Oppong Nkrumah has rejected the minority’s claims as mere doom-mongering.
In sharp rebuttal Wednesday, Government rejected the claims pointing out the Minority is notorious for badmouthing the economy.
“You recall the Minority’s claim that literally Ghana has been sold to Franklin Templeton in the first issuance of the $2.25bn bond and all the brouhaha that followed, which was totally unfounded.
“You recall the Minority’s prediction of 1983-like famine ahead of the midyear budget review of 2017 which prediction did not also come to pass,” Information Minister, Kojo Oppong Nkrumah asked the press rhetorically.