Bussiness
Cedi depreciation slows down; now sells at about ¢7.84
The cedi appears to be responding positively to the recent increment in the Policy Rate by 2.5 percentage points to 17% and other actions taken by the Bank of Ghana to address its depreciation.
The local currency traded below ¢8 to the US dollar at most forex bureaus and banks, yesterday, March 23rd, 2022. Same were said of the British pound and the euro.
In actual fact, the cedi appreciated by 1.20% to the dollar, 0.47% to the pound and 1.52% to the euro respectively on March 23rd, 2022. However, in terms of the year-to-date, the local currency has lost about 15% in value to the dollar.
The local currency can further reverse its lost fortunes and slowdown the rate of depreciation significantly after the announcement of the expected fiscal measures by the Finance Minister, Ken Ofori-Atta, later today, March 24th, 2022.
Currency Analyst, Courage Martey, had earlier told Joy Business that the cedi will soon improve upon its ailing performance against the dollar.
“In the interim, we’ll say its early days yet. In addition to that, the cedi also has a history about its performance and so we will also want to look forward to what the Minister of Finance [Ken Ofori-Atta] will be delivering as far as the fiscal decisions are concerned. From that point and the weeks ahead, we’ll start to analyze the foreign exchange market to see how the cedi will react to some of these announcements”.
“But on the face of it, this appeared to be good measures; aggressive and decisive measures from the Central Bank which we expect to be backed by the fiscal measures, so that going forward the market – at least sentiments – should start to improve. Once it’s starts to improve, we should start to see it reflecting in the pricing behavior of participants on the market”, he added.
The increase in the policy rate by 2.5 percentage points to 17% is expected to entice investors to acquire cedi denominated instruments because of the attractive yields they will come with.
Though cost of borrowing will go up, while cost of living and doing business will also surge, the Central Bank will in the interim mop up excess liquidity in order to control inflation and reduce interest in dollar denominated assets.
Source: www.myjoyonline.com
Bussiness
Ghana’s GDP shows economy is fast recovering despite DDEP – Finance Ministry
Ghana’s Gross Domestic Product (GDP) indicates a rapid economic recovery despite global challenges and ongoing debt restructuring, according to the Ministry of Finance (MoF).
The Ministry in a statement today indicated that latest data from the Ghana Statistical Service (GSS), cumulative economic growth for the second quarter (Q2) of 2024 reached 6.9%, a notable increase from the 4.7% recorded in the first quarter of 2024.
The MoF statement further noted that, “The economy’s robust recovery is in response to the macroeconomic stability and growth interventions that government is pursuing under our IMF-supported Post Covid-19 Programme for Economic Growth (PC-PEG).”
According to them, the overall real GDP growth for the first half of 2024 rebounded strongly, with year-on-year GDP growth averaging 5.8% for the period, significantly higher than the 2.9% recorded in the same period in 2023.
By Edem Mensah-Tsotorme
Read full statement below
Bussiness
Facebook, Youtube, online trading companies must be taxed – Deputy Finance Minister
The Deputy Finance Minister Dr Alex Ampaabeng, has proposed that online trading companies should be taxed to bolster the economy.
He noted that these companies, both local and international, generate significant revenue from their Ghanaian clients, which underscores the necessity for taxation.
In an interview with Bernard Avle on Channel One TV’s The Point of View, Dr Ampaabeng pointed out various potential revenue sources for Ghana, including online businesses and content creation companies.
He questioned why other national companies operating in Ghana are taxed, but social media platforms like Youtube and Facebook, which run numerous advertisements, are not included in the Ghanaian tax system.
According to him, these social media companies earn profits from the advertisements they display, and online trading companies also generate income from the sale of their products and services.
He mentioned online trading companies such as Jiji, Jumia, and Tonaton, which he believes surpass all physical marketplaces in Ghana in size.
According to him, “I can’t think of a country which has not gotten a digital service tax system of some sort, so Ghana is long overdue. Just to make an example so that people will appreciate where I’m coming from. Go to Youtube and play a video, within one or two minutes, you are going to watch about two, or three adverts.”
“What it tells you is that Facebook or Youtube is making profits right here in Ghana. Go to your Facebook account, and you are going to see a number of adverts on your right, left. What it is telling you is that Facebook is making profits right here in Ghana and not being taxed. Meanwhile, there are companies operating in Ghana, for jurisdiction reasons, of course, that are being taxed,” he said.
The Deputy Minister added that “So then, it comes to the question of the application of our tax laws. Revenues generated in Ghana are subject to taxes. We have Facebook, TikTok and all those players, these are digital platform owners.”
He stressed, “Then we have the digital or market players, here we are talking about individuals who are using the digital platforms. We have Jiji, Jumia, Tonaton, these combined, are bigger than all physical marketplaces in Ghana. And it tells you the volume of transactions, that are going on there.”
He expressed his hope that individuals earning online profits from Ghanaian residents would be taxed.
“There are conversations ongoing, I wouldn’t want to pre-empt anything, maybe in the future, it might not be anytime soon, what I would like to see, is a Ghana where people who are earning all forms of profits in the country are subject to taxes. People who are trading online to Ghanaian residents, people who are generating revenue from Ghana are allowed to pay taxes,” he noted.
Additionally, he proposed a collaboration with the government to curb cybercrime by registering and verifying these online trading companies.
“We can have a system where the government engages these operators, so individuals will submit their Ghana Card and are registered and verified,”he concluded.
Source: Citinewsroom.com
