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We must own our exports – Joe Jackson speaks on cedi depreciation.



We must own our exports – Joe Jackson speaks on cedi depreciation.

The Director of Operations at Dalex Finance, Joe Jackson, says the depreciation of the Ghanaian cedi can only be reined in when the country owns its exports.

According to him, despite Ghana’s exports outweighing the imports, the cedi continues to suffer because ownership of the exports has been given to foreigners, who take resources out but do not bring in any of the money.

Speaking on JoyNews’ PM Express, Mr Jackson said, “Unless we look at what the problem is…we’ve all said, ‘oh, Ghana likes to import. Ghana likes to import’. But, data shows that it is slowing down. Not just slowing down. It shows that for the last how many years, right? We export more than we import.

“So why is our cedi not appreciating? Because those who must enforce the law, those who must take us forward are not. We have given up ownership of our country to foreigners and when they take their money out, they don’t come back,” he added.

He said that the import activities of the Ghana Union of Traders Association (GUTA) are not to be blamed as many assume.

Referring to statistics from other countries, Mr. Jackson highlighted the disparity in the return of export earnings to Ghana compared to nations like Botswana and Nigeria.

“Botswana, when they export oil, 51.8% come back into the country. Non-oil, diamonds, non-oil, diamonds. In Nigeria, when they export oil, 51% of the money comes back to the country. Check out Ghana. I’m telling you that the problem is the ownership. In fact, for our non-oil, it’s as low as 6.5%. This is the problem.”

Mr. Jackson emphasized the need for Ghana to retain more of its export earnings within the country to stabilize the currency.

He argued that without addressing the issue of ownership of exports, Ghana would continue to face challenges with currency depreciation.

“Let me tell you what happens in other countries. They use what you call a joint venture agreement. Let’s assume Newmont is exporting gold, we say to them that 50% of the gold you export we want to own it. Charge us for the extraction.”

“Why is Botswana able to do it? Why is Nigeria able to do it? Why are other countries able to do it and we can’t do it? And then we sit here and we complain. What is it different about Nigeria that Nigeria can enforce laws that make it retain 51 plus per cent of its exports, but Ghana, it is a measly 17%?”

This comes after the Ghana cedi weakened further against the US dollar and other major foreign currencies as corporate demand soared in the past month.

But JoyBusiness reports that depreciation pressures on the cedi have slowed down as a result of improved foreign exchange (FX) liquidity.

This, the report attributed to a significant intervention by the Bank of Ghana in the market last week, providing about $59 million on the spot market and auctioning $20 million to the Bulk Oil Distribution Companies.

The move by the central bank marked the most significant support provided in a week since the beginning of 2024.

Meanwhile, Mr Jackson called for the enforcement of local content laws among other things.

He also called on Parliament to pass laws that ensure companies pay royalties and taxes in US dollars rather than in cedis. “Why is it that they take and they give us peanuts?”

Mr. Jackson also advocated for production agreements that would allow Ghana to retain a larger portion of the profits from its exports, particularly in industries such as gold mining and lithium extraction.

The Dalex Finance Director said that the rate of depreciation is affecting livelihoods and needs to be addressed. “We are suffering. We are the ones who bear the brunt of this issue. And all of us, you see, this is why I’m saying that we should do the right thing.”

SourceL My Joy Online

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