Shift to domestic financing key to long-term stability – Prof. Asuming

Economist Professor Patrick Asuming has called for a change in Ghana’s economic strategy. He urges policymakers to reduce reliance on foreign financing. This shift is necessary for long-term currency stability.

Professor Asuming noted that Ghana has had trade surpluses since 2017. However, the cedi remains vulnerable due to dependence on external funding. He explained that servicing foreign loans and repatriating profits puts pressure on the local currency, especially in the first quarter of each year.

He stated, “We need to change the financing of the economy.” He emphasized that dependence on foreign financing must be addressed. Despite trade surpluses, loan servicing and payments to foreign companies create challenges.

To improve this situation, Asuming suggested a gradual shift towards domestic financing. He believes this should happen over the next five to ten years. In the short term, he urged the government to curb unnecessary imports.

He specifically mentioned food imports as a major contributor to trade imbalances. “We should cut imports of non-essential items,” he said. He added that Ghana should not be overly dependent on food imports at this time.