The Minister of Foreign Affairs, Hannah Tetteh has shot down calls for the establishment of an Export Development Bank.
The bank was to be established to provide finance for industries focused on producing for exports.
Citi Business News gathers plans to establish this bank has been on the table for some time.
Hannah Tetteh said this at the Graphic Business/Fidelity Bank Breakfast meeting on the theme “Maximizing the value of exports to improve Ghana’s trade balance”.
Minister of Trade and Industry, Haruna Iddrisu announced the Export Development and Agricultural Fund (EDAIF) will be turned into a bank over a five year period. EDAIF is currently focused on providing debt and equity finance for Agricultural and other Export industries.
“I am in discussion with the Ministry of Finance for the strategic conversion of EDAIF into an import and export bank over a five year period. We needed to be guided about the feed because it relies on an import levy, we need to work such that we can sustain it over a period of time and to learn some of the lessons that other state financial institutions have been subjected to”.
But the former Minister Trade and current Minister of Foreign Affairs, Hannah Tetteh says there is no need for an export-focused bank.
“I don’t think the issue is to setup another bank. If we honestly reflect on our past, we will know that the challenge with most of the state-owned banks has been that there have been interests that have determined their lending policy.”
According to her, “Those interests have not been based on sound economics as a result of which banks have to continue to be bailed out by the government of Ghana or by other means.”
“They have not performed the core function assigned to them” she added.
Earlier, former Minister of Trade under the Kuffour Administration blamed the worsening Trade deficit on the lack of an efficient trade bank dedicated to export finance.
According to Dr Konadu Apraku, while in office he instituted the policy for the establishment of the bank, but this was not implemented.
“I proposed the setting up the Ghana Export and Investment bank- a bank that will have the primary responsibility for financing and promoting our nation’s exports. I consulted with several important stakeholders including the association of Ghanaian industries, and the banking community to help formulate the concepts to set the stage for a feasibility study for the establishment of the bank.”
“Unfortunately I could not complete that work before I left the ministry. As far as I know, not much has been done” he added.
Graphic Business Fidelity Bank Breakfast meeting, second in its series was focused on bringing together stakeholders and captains of the industries on a way to harness Ghana’s export potential.
By: Kwaku Anim Boadu/citifmonline.com/Ghana