By Francis Ntow
Accra, Sept. 22, GNA – Ghanaian manufacturers have called for a common African currency to reduce exchange rate volatility and lower the cost of intra-African trade.
The Association of Ghana Industries (AGI) said currency fluctuations continued to affect import and export costs, capital accumulation and the volume of trade across the continent.
Dr Paa Kwesi Eduaful Abaidoo, an AGI representative, made the call in an interview with the Ghana News Agency after the third edition of the Graphic Business/Stanbic Bank forum.
The forum was held on the theme: “Moving money, moving trade, moving Ghana – making it easier to buy, sell, and pay across borders.”
Dr Abaidoo, who is also the Sustainability Manager at Mini Plast Ltd, said businesses faced structural constraints, including limited capacity, weak demand and difficulty accessing affordable credit.
He said exchange rate instability remained a major challenge, particularly because businesses could not accurately predict the local currency cost of transactions denominated in foreign currencies.
“Today, you know you are benchmarking your import or trade with an exchange rate but by the time the goods comes for payment, the rate is somewhere else,” he said.
Dr Abaidoo urged the African Continental Free Trade Area (AfCFTA) Secretariat to take the lead in advancing the long-standing agenda for a common African currency.
“Is it time for the AfCFTA Secretariat Africa to push the agenda of having a common currency. Indeed, what we wish to have beyond the platform that the banks are providing is for us to have a common currency,” he noted.
Dr Abaidoo said a common currency could help address exchange rate volatility associated with cross-border transactions and urged African governments to pursue measures to make the initiative feasible.
He said the AfCFTA, five years into its operationalisation, had provided the institutional framework for increased intra-African trade, but greater political cohesion was required to translate the framework into full economic integration.
Mr Musah Abdallah, Head of Corporate and Investment Banking at Stanbic Bank Ghana, said the Pan-African Payment and Settlement System (PAPSS) had become an important mechanism for settling intra-African transactions and facilitating AfCFTA trade.
“The most important thing us that is has started and starting alone is a big achievement because. The opportunity for us to scale is what all banks on PAPSS are working together to ensure that all countries which are part of AfCFTA scale it.
“What is left to be done amongst banks and customers is to ensure that trade within AfCFTA is escalated. Governments must work to remove trade barriers, while banks continue to build payment systems and ensure connectivity with partner banks across countries,” he said.
Mr Abdallah said African governments and financial regulators, including the Bank of Ghana, were investing in understanding emerging technologies such as artificial intelligence and cryptocurrencies to ensure their proper regulation before deployment in support of financial stability and scalable trade.
GNA
Edited by Kenneth Sackey
Reporter: Francis Ntow