|Invest In Capital Markets, Governor Tells Policy Makers|
|Wednesday, 15 February 2012 11:28|
Central Bank Governor, Mr. Kwesi Amissah-Arthur, has tasked policy makers in the sub-region to invest in building institutions that promote the growth of capital markets and fiscal accountability to enhance resource mobilization for investment.
Speaking at a regional course on financial programming and policies in Accra, Mr. Amissah-Arthur urged policy makers to hold firm and implement appropriate monetary and fiscal policies as well as structural reforms to ensure macroeconomics and financial stability.
‘’We must pay particular attention to macro prudential regulatory matters and financial stability issues, macroeconomic management of remittances and other capital flows as well as public financial management reforms’’, he said.
The two-week course, which is being attended by more than 30 officials from central bank and other public sector agencies from The Gambia, Ghana, Liberia, Nigeria and Sierra Leone, is organized by the West African Institute for Financial and Economic Management (WAIFEM) and the International Monetary Fund (IMF) Institute.
Governor Amissah-Arthur suggested to the participants to use financial programming to formulate an internally constituent set of macroeconomic policies that are aimed at maintaining or improving economic performance while strengthening macroeconomic stability.
He cautioned that when financial regulators wanted to address any macro-economic imbalances, they must take into account the impact of those measures on all sector of economy and the potential overall economic, political and socio-economic repercussions.
‘’Any macro-economic imbalance should be overcome through an integrated approach by implementing appropriate monetary, fiscal, exchange rate, trade and income policies, as well as structural measures including public sector reform, financial sector reform and price liberalisation or adjustment’’.
He said in spite of the three decades of reforms, the economies of the sub region were still characterized by macroeconomic imbalances that manifest in rising unemployment, high inflation and huge external imbalances.
According to him, several exogenous factors continued to complicate economic policy-making in many of the economies. ‘’On the balance however, the past year, 2011, has largely been a year of success for most countries in Sub Sahara Africa. At 5.25 per cent, average growth for the region has been impressive despite the 2008-2009 global economic crisis. Diversification of our economies is increasing with consumer markets, manufacturing and services growth steadily’’.
The International Monetary Fund’s most recent forecast for Sub- Saharan Africa anticipates average growth of 5.5 per cent in 2012, and a number of individual economies in West Africa are expected to exceed the seven per cent mark. Nigeria is expected to grow at 6.6 per cent while Ghana, Cote d’Ivoire and Liberia are expected to have growth rates of 7.3, 8.5 and 9.4 per cent respectively, while Sierra Leone is forecast to grow by 5.4 per cent in 2012 propelled by the iron ore mining operations.
The major drives of the region’s growth in 2012 are expected to come from domestic factors, particularly consumer demand, the emergence of investment in the consumer market and growth driven by the telecoms sectors, particularly the mobile front. On the other hand, the primary external driver of growth in the region could continue to be high commodity prices, particularly for oil and gas. Despite dropping significantly from the 2008 high of $150, they continued to hover around the US$100 mark, due to strong demand from China and India.
Nevertheless, the looming risk of a renewed global slowdown as a result of Europe’s sovereign debt crisis presents policy makers in the 2008-09 shock, with a daunting challenge in the year ahead.
Director-General of WAIFEM, Professor Akpan H. Ekpo, is confident that the topics covered in the course will enhance the capacity of economists and policy makers to analyse economic developments, diagnose imbalances in the economy, make accurate forecasts and recommend appropriate policies.
The two-week course is aimed at enhancing participant’s understanding of macroeconomics and financial policies, and particularly how to design an appropriate set of policy measures in the context of a comprehensive macroeconomic adjustment programme. The course covers principal features of the main macroeconomic sectors, namely, the real, external, fiscal and monetary sectors and the interrelationships and dependency among economic sectors.