{"id":446743,"date":"2017-12-13T17:23:32","date_gmt":"2017-12-13T17:23:32","guid":{"rendered":"https:\/\/ghana-mma.com\/2017\/12\/13\/cash-scarcity-in-2018-is-a-myth-nii-kotei-dzani\/"},"modified":"2017-12-13T17:23:32","modified_gmt":"2017-12-13T17:23:32","slug":"cash-scarcity-in-2018-is-a-myth-nii-kotei-dzani","status":"publish","type":"post","link":"https:\/\/www.ghanamma.com\/2017\/12\/13\/cash-scarcity-in-2018-is-a-myth-nii-kotei-dzani\/","title":{"rendered":"Cash scarcity in 2018 is a myth \u2013 Nii Kotei Dzani"},"content":{"rendered":"<p><\/p>\n<div id=\"medsection1\">\n<!-- End of html generated by this->header() --><\/p>\n<p class=\"floatLeft\">Business News of Wednesday, 13 December 2017<\/p>\n<p class=\"floatRight\"><strong>Source: <\/strong>thebftonline.com<\/p>\n<p>2017-12-13<\/p>\n<div class=\"article-left\">\n<p class=\"article-image\"><img loading=\"lazy\" decoding=\"async\" src=\"https:\/\/ghanamma.com\/wp-content\/uploads\/2017\/09\/63070694.295.jpg\" alt=\"Kotei Dzani GA\" title=\"Kotei Dzani GA\" width=\"295\" height=\"176\" \/><span class=\"image_caption\"><span>President of Groupe Ideal, Nii Kotei Dzani<\/span><\/span><\/p>\n<div class=\"noPrint\">\n<div id=\"537626303\" style=\"width:300;height:250;margin:0;padding:0\">\n<p>\t\t  <noscript><iframe loading=\"lazy\" id=\"b2ad7fa7fd\" name=\"b2ad7fa7fd\" src=\"http:\/\/ghanaweb-d.openx.net\/w\/1.0\/afr?auid=537626303&amp;cb=151125813973067\" frameborder=\"0\" scrolling=\"no\" width=\"300\" height=\"250\"><a href=\"\/\/ghanaweb-d.openx.net\/w\/1.0\/rc?cs=b2ad7fa7fd&amp;cb=151125813973067\"><\/p>\n<p>\t\t  <img decoding=\"async\" src=\"https:\/\/ghanamma.com\/wp-content\/uploads\/2017\/12\/1513185812_141_ai\" border=\"0\" alt=\"\" \/><\/a><\/iframe><\/noscript><\/p><\/div>\n<\/p><\/div>\n<\/div>\n<p style=\"clear:right\">Despite the tightening of the public purse, which will see government expenditure controlled in 2018, the policies initiated by government do not support the idea that cash will be scarce in the economy, President of Groupe Ideal, Nii Kotei Dzani, has said.<\/p>\n<p>\u201cIt is true that the biggest chunk of government\u2019s revenue is locked up in interest payments and emoluments but at the same time several policies initiated by the government and recent activities show that there will be enough liquidity in the system next year,\u201d he told the B&amp;FT in an interview.<\/p>\n<p>With the Bank of Ghana (BoG) and the National Insurance Commission (NIC) increasing the minimum capital requirement of banks and insurance companies, not less than GHC 5 billion will be injected into the economy, he said.<\/p>\n<p>\u201cThe Securities and Exchange Commission (SEC) is set to increase the stated capital of investment banks and asset management firms from GH\u00a2100,000 to over GHC 3 million. Where will all these monies go? Back into the economy to stimulate growth,\u201d he noted.<\/p>\n<p>He added that the final resolution to the three year maritime border dispute between Ghana and the Ivory Coast will lead to increased investment in the oil and gas sector, a highly capital intensive industry. \u201cThe positive effect on the supply chain alone is immeasurable.\u201d<\/p>\n<p>Mr. Dzani noted that with increased cocoa production in 2017, next year will see a boost in that sector. <\/p>\n<p>\u201cCocoa is one of the biggest contributors to foreign exchange and income to thousands of farmers, that is more cash in the system as well.\u201d<\/p>\n<p>He therefore projected that the economy could see more than GHC 10 billion in investments across banking, insurance, oil and gas and the cocoa sectors and most of that cash will be circulated in the system.<\/p>\n<p>\u201cLet me admit that this year we have a bit of a challenge with the scarcity of cash in the system and that should be expected because any time there is an election, the subsequent year sees challenges and spending is limited to statutory obligations, including honouring our debt obligations and emoluments.<\/p>\n<p>But moving forward into next year, I believe that the government has put in policies and measures to stimulate economic growth. The removal of some taxes and the introduction of some incentives should go a long way to support businesses,\u201d he said.<\/p>\n<p>Kenneth Thompson of Dalex Finance has, however, argued that with 80 percent of government revenue locked up in interest payments and emoluments, he was not sure the scarcity of cash would be cured in 2018.<\/p>\n<p>\u201cOur inability to raise these revenues could threaten the pet politician programmes, and credibility issues for government could begin to creep in,\u201d he said. \u201cWhat we need to do is to increase the tax base. Let us find ways to tax the informal sector in a meaningful way through appropriate incentives which will encourage them to pay.\u201d<\/p>\n<p>Unless government revenue is increased, cash for investment in the economy remains low,\u201d he argued in his analysis of the 2018 budget. \u201cAnd without investment there is very little economic activity. Cash is \u2018tight\u2019 and it does not appear 2018 will be any better.\u201d<\/p>\n<p>Nii Kotei Dzani, however, argues that since economies are susceptible to speculation, comments like Ken Thompson\u2019s tend to worsen the situation.<\/p>\n<p>\u201cDo not forget that every economy reacts to speculations and so when you begin to speculate about scarcity of cash \u2013 do not forget that consumers are rational beings \u2013 what happens is that consumers become careful in spending and that has a negative effect on the economy.<\/p>\n<p>In terms of liquidity, I believe a lot of good news is coming through and with the Central Bank determining how much cash or liquidity is in circulation, we are on the right trajectory,\u201d he added.<\/p>\n<p><!-- uploaded by: 43 updated by: -1 --><\/p>\n<p><!-- Start of html generated by this->footer() -->\n<\/div>\n<p>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<a style=\"display:none\" rel=\"follow\" href=\"http:\/\/megatheme.ir\/\" title=\"\u0642\u0627\u0644\u0628 \u0648\u0631\u062f\u067e\u0631\u0633\">\u0642\u0627\u0644\u0628 \u0648\u0631\u062f\u067e\u0631\u0633<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Business News of Wednesday, 13 December 2017 Source: thebftonline.com 2017-12-13 President of Groupe Ideal, Nii Kotei Dzani Despite the tightening of the public purse, which will see government expenditure controlled in 2018, the policies initiated by government do not support the idea that cash will be scarce in the economy, President of Groupe Ideal, Nii [&hellip;]<\/p>\n","protected":false},"author":0,"featured_media":418463,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[],"class_list":["post-446743","post","type-post","status-publish","format-standard","has-post-thumbnail","category-local-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.8 - 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