GOLD REFINERY, AND OTHERS…

TODAY, I WILL FOCUS ON VARIOUS ISSUES WITH SMALL COMMENTS. USUALLY HERE IN THIS COUNTRY, DISCUSSIONS REPEAT THEMSELVES. THEREFORE, MY COMMENTS WON’T CHANGE MUCH, UNLESS I CHANGE MY OPINION. THIS DOES NOT HAPPEN VERY OFTEN CONCERNING THE MAJOR ECONOMICAL AND FINANCIAL ISSUES.

HERE ARE MY THREE ITEMS FOR BRIEF COMMENTS TODAY, GOLD REFINERY, SAVINGS&LOANS COMPANIES, AND CEDI WEAKNESS:

1) GOLD REFINERY IN KUMASI?

YESTERDAY, THERE WAS AN ARTICLE IN THE GHANAIAN BUSINESS&FINANCIAL TIMES (https://thebftonline.com ) ABOUT AN INVESTMENT ATTEMPT. IT SAID THAT A GHANAIAN INVESTMENT COMPANY PLANS TO BUILD A GOLD REFINERY IN KUMASI, VALUED BETWEEN 30 AND 50 MILLION US-DOLLARS. A VERY GOOD IDEA, BECAUSE EVERY ATTEMPT TO PUT ADDITIONAL VALUE ON INLAND RESOURCES IS A LAUDABLE UNDERTAKING. I ONLY HOPE THAT THIS IDEA WILL BE REALISED AND SUCCESSFUL. IN THE PAST, THERE WERE SEVERAL PROJECTS THAT PROMISED A PUSH FOR THE GHANAIAN ECONOMY. MANY OF THEM WERE NOT REALISED AT THE LONG RUN FOR ONE REASON OR THE OTHER. WHEN I CHECKED ON BING FOR THE INVESTMENT COMPANY, I DIDN’T FIND ANY SEARCH RESULT. AT LEAST, I FOUND IT ON GOOGLE TODAY. BUT ON THE WEBSITE, THERE WAS NO HINT POINTING TO THIS PROJECT. LET’S HOPE THAT AFTER THE MENZGOLD EXPERIENCE, WE WON’T GET ANOTHER TURMOIL IN THIS SECTOR.

2)  BANK OF GHANA WILL INVESTIGATE SAVINGS AND LOANS COMPANIES

IN THE SAME NEWSPAPER, THERE WAS AN ARTICLE THAT THE BANK OF GHANA WANTS TO CHECK ON SAVINGS & LOANS COMPANIES. THE CENTRAL BANK INTENDS TO EIMINATE THE WEAK PARTS OF THE SECTOR. I SUPPORT THIS MOVE BY THE BANK OF GHANA COMPLETELY.

FURTHERMORE, I MUST ADD THAT I BELIEVE THAT THE NECESSITY OF THE WHOLE SECTOR SHOULD BE IN QUESTION. AS IN THE CASE OF MICROFINANCE INSTITUTIONS, THE QUESTION IS OF WHICH USE THEY ARE. THE FOCUS SHOULD BE ON RURAL AND COMMUNITY BANKS. WE SHOULD STRENGTHEN THEIR POSITION AND QUALITY OF SERVICE. INSTITUTICONS SHOULD DIRECT PEOPLE WITH NO OR WEAK  ACCESS TO THE FINANCIAL SECTOR TO RURAL AND COMMUNITY BANKS. A STRENGTHENING OF THESE PARTICIPANTS IN THE SECTOR WOULD INFLUENCE THE WHOLE FINANCIAL SECTOR IN GHANA POSITIVELY.

3) THE WEAKENING OF THE GHANA CEDI AGAINST THE US-DOLLAR

THIS MORNING AGAIN, I HEARD IN A DISCUSSION THE POINT THAT THE GHANAIAN CEDI DEPRECIATES AGAINST THE US-DOLLAR. I AM  SOON FED UP WITH THESE REPETITIONS. FACT IS THAT THE STRONG US-DOLLAR AFFECTS ALL CURRENCIES IN EMERGING MARKETS NEGATIVELY. E.G., THIS MORNING THE INDIAN RUPEE IS AT AN ALL-TIME LOW AGAINST THE US-DOLLAR. COMPARED WITH THAT, THE CEDI PERFORMS RATHER CREDIBLY.  THIS IS ESPECIALLY IF WE COMPARE THE POTENTIALS INDIAS ECONOMY HAS WITH THOSE IN GHANA. SO, STOP BLAMING THE GOVERNMENT FOR THE WEAKNESS OF THE CEDI.

 

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