The Governor of the central Bank of Ghana (BoG), Dr. Ernest Addison has said that it’s a crime for any businesses or organisations operating in the country to index their prices in United States Dollars or in any forex currencies.
Dr. Ernest Addison therefore, calling on managements of businesses or organisations operating in Ghana should desist from such acts when he appeared before the Parliament’s Public Accounts Committee (PAC) in Accra yesterday to considered the Report of the Auditor-General on the statement of Foreign exchange receipts and payments of the Bank of Ghana for 2017 and 2018.
The Governor of BoG answering questions from the Member of Parliament (MP) for Ningo-Prampram Constituency, in the Greater Accra Region, Mr. Samuel Nartey George on whether it is still a crime under the laws of Ghana for companies to index their Prices of goods and services in foreign currency said the laws of the land prohibits trading in forex.
It would be recalled that the BoG, in July 2019 issued a notice reminding businesses and other institutions of the Foreign Exchange Act, 2006 (Act 723) which prohibits the pricing, advertising and receipt or payment for goods and services in foreign currency.
According to the central bank violation of the law may result in summary conviction, a fine of up to 700 penalty units or a prison term of not more than 18 months, or both.
However, according to the Ningo-Prampram lawmaker some companies, especially hotels, international schools, and supermarkets have disregarded this directive and continue to trade in foreign currency in a disguised form.
Mr. Nartey George explained some companies operating in the Ghana are using unorthodox means at the blind side of regulators to still trade in foreign currency. These businesses uses index to prices their goods and services in United States Dollars but collect payment in Cedis.
He said such practices brings fluctuation in fees paying due to fast depreciation of the Cedi and want the BoG to act in earnest to save the situation.
But the Governor of BoG maintained that the dollarisation phenomenon have will soon be a thing of the past due to the stability of the Cedi.
“We are putting all the macroeconomic and microeconomic indicators on a sound footing and there will be no incentives for anybody to price its goods and services in foreign currencies.
In another development, a member of the committee and MP for Aowin Constituency in the Western Region, Mr. Mathias Kwame Ntow enquired from the Governor the steps his outfit is taking eradicate the country of illegal forex trading.
Dr. Addison in a response stated activities of illegal forex trading have reduced in the country saying the shortage of foreign exchange which gives rise to the activities of illegal forex trading, popularly known as the “Black Market” is no long prevalent.
The BoG Governor credited this to the government’s better management of the economy.
“The black market is an illegal activity and the Bank of Ghana has collaborated with the security agencies to ensure that they don’t thrive and we have had a few exercises in different parts of the country literally going out there to arrest black market traders and foreign exchange.
It is an illegal activity and the security agencies are on top of that issue. I think the pressure in terms of the prevalence of black market activities has gone down and the reason is that the economy is relatively doing well and there is no big shortage and therefore the incentive too isn’t there. This is an illegal market and you are not going to completely wipe it away. From time to time we are cooperating with the security agencies to enforce the law,” Dr. Addison boasted.
Story: Franklin ASARE-DONKOH