Bussiness
Concerted effort needed to build a viablemonetary union – Dr Addison
Dr Ernest Addison, Governor, BoG
A concerted effort is required to help improve the region’s macroeconomic environment and place it on a stronger convergence path for a viable monetary union, Governor of the Bank of Ghana (BoG), Dr Ernest Addison, has stated.
That, he said, would help facilitate the move by Economic Community of West African States (ECOWAS) for a single currency by 2027.
According to him, the assessment of the regional economies for 2022 showed that no member state satisfied the four primary convergence criteria, and same cannot be achieved in 2023.
The convergence criteria include a single-digit inflation, a fiscal deficit of not more than four per cent of Gross Domestic Product, and central bank deficit financing of not more than 10 per cent of previous year’s tax revenue.
ECOWAS initiated a move two decades ago for a single currency as pertained in Europe and the Authority of the ECOWAS Heads of State and government adopted a new roadmap for the launch of the ECO and a new Macroeconomic Convergence and Stability Pact, which should be met by member states by December 31, 2026.
COVID-19 pandemic disrupt¬ed the plan to launch the ECO in 2020.
Dr Addison made the call at the 43rd Ordinary Meeting of the Economic and Monetary Affairs Committee and the Operations and Administration Committee of the West African Monetary Agency.
The meeting, being convened by the Government of Ghana under the auspices of the Ministry of Finance and the Bank of Ghana, in collaboration with West African Monetary Agency (WAMA), the West African Africa Institute for Financial and Economic Management (WAIFEM), and the West African Monetary Institute (WAMI), formed part of the West African Monetary Zone meeting currently underway in Accra to review macroeconomic developments in the region.
Dr Addison, in a keynote address read on his behalf by the Director of Research of BoG, Dr Philip Abradu-Otoo, said the concern now was whether the 2026 deadline for achieving the convergence was still realistic in the face of the disruptive effects of the repeated shocks on the region.
“This, perhaps, calls for a readiness assessment for the launch of the ECO in 2027 as we move along,” he stated.
The Governor said in spite of the challenges, notable progress had been made in the roadmap for the implementation of the single currency objective, adding that “A lot more remained to be done”.
“While we strive to fulfil the arduous task of meeting the convergence criteria, we need to pay equal attention to other key areas of the roadmap,” Dr Addison stated.
He stressed the need for the unification of the payment and settlement systems and harmonisation of statistics in the region.
Dr Addison said the meeting would involve critical discussions across various sectors of the region’s economies and the im-plementation of roadmap of the single currency for the region.
The Governor of BoG entreated the delegates to participate actively and help broaden the policy discourse towards a viable monetary union.
The Director-General of WAMA, Momodou Bamba Saho, said there was the need for enhanced strategies and reforms to ensure all the member states of ECOWAS met the ECO Convergence Criteria.
“It is incumbent that our work here not only remains pertinent and useful to member states, but also serves as bedrock of stability and cohesion in these very complex times,” he stated.
BY KINGSLEY ASARE
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
