‘Banking reforms will make Ghana safest investment destination’
The Bank of Ghana (BoG) is confident that reforms in the banking sector will help position the country as the safest investment destination in the sub-region.
An Advisor at the Governor's Department of the BoG, Mrs Grace Akrofi, said having fewer resilient banks sent signals to investors that their funds would be safer when they chose the country as their investment destination.
“What we did was to look at something not going well and clean it up. If we have a few better banks that are strong and safe, then investors can get the assurance that they will meet banks that are serious and not banks that have problems with their management,” she said.
Mrs Akrofi was contributing to a panel discussion at the 3rd UK-Ghana Investment Summit in Accra yeaterday organised by the UK-Ghana Chamber of Commerce (UKGCC).
Over 50 UK companies are attending the summit to discuss trade and investment opportunities in Ghana.
The BoG, as part of measures to sanitise the banking industry, revoked the licences of two indigenous banks last year due to severe liquidity challenges. It also consolidated five local banks into a single entity as a result of solvency issues.
“We intend to have fewer stronger and safer banks than to have many banks with some that are not very strong. I think that we should feel happy that with the banks that are still in the system, if they (investors) bring in their funds, they will be safe,” she added.
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As part of sanitising the banking sector, she said, the BoG had increased the minimum capital requirement of banks to GH¢400 million, which should be met by the end of this year, as part of measures to ensure that the sector was adequately capitalised.
“The idea is to first of all address all the banks that have problems with capital. At the same time, for banks that are able to provide the capital, they are well positioned to take on big businesses because I see a lot of big businesses around,” she added.
Explaining the rationale for the recent clean-up in the sector, she said the takeover of the banks was to save them from collapsing.
“If you do not sanitise the system, you will see that it will spread all over. What we did was to take over banks that were failing to prevent them from collapsing,” she stated.
Building UK- Ghana relations
The Minister of State for Trade and Export Promotion of the UK, Baroness Rona Fairhead, said the UK was working with Ghana to improve bilateral trade and support Ghana to become the hub of investment in West Africa.
She also reiterated the UK’s commitment to support the ‘Ghana Beyond Aid’ agenda to help with the growth of the economy and create the needed jobs.
“Today, we have over 50 UK companies in Ghana to learn about opportunities, details of incentives to support investments, engage face to face with ministers and officials in the specific sectors and also get details of specific projects and to be introduced to local partners,” she said.
Ms Fairhead added that the UK would continue to invest in projects as part of the shared agenda across Africa to drive economic growth on the continent.
The Chief Executive Officer of the UKGCC, Mr Tony Burkson, said the summit was one of the many ways through which the UK-Ghana Chamber of Commerce was opening doors and building bilateral corporate relationships between Ghana and the UK.
“With this summit, we continue to build upon the work done so far in the effort to facilitate trade between these two great nations. This event has been curated to highlight different sectors within Ghana,” he said.