IMF Urges Review of Forex Rules

The International Monetary Fund (IMF) wants the Bank of Ghana to review the recent foreign exchange rules it implemented.

The IMF’s country representative Samir Jahjah says the fund has recommended to the Bank of Ghana to ‘review the measures in light of the reaction of the business community and investors’.

The bank last month implemented new and revised rules aimed at saving the cedi from further fall against major foreign currencies.

Among the rules commercial banks were banned from issuing cheques and cheque books on Foreign Exchange Accounts (FEA) and Foreign Currency Accounts (FCA).

Banks are also prohibited from granting a foreign currency-denominated loan or foreign currency-linked facility to a customer who is not a foreign exchange earner.

The central bank also banned offshore foreign deals by resident companies, including exporters in the country.

Also over-the-counter cash withdrawals from foreign exchange and foreign currency accounts not exceeding US$10,000 shall only be permitted for travel purposes outside Ghana or its equivalent in convertible currency per person per travel.

However the introduction of the rules immediately sparked concern among local and foreign investors, who anticipate a tougher operating environment.

IMF’s representative in Ghana Samir Jahjah tells Citi Business News the central bank would have to listen to concerns raised and look at reviewing it.

‘Are these measures hurting the economy or not? Are they affecting capital flows? We (IMF) don’t have that response. That is why it is important that after a while they look at the impact of these measures on the various parts of the economy the financial sector but also the real sector, and based on this review, reassess these measures if needed”, Samir Jahjah added.