Economist and lecturer at the Wisconsin International University College, Dr. Samuel Worlanyo Mensah has revealed that the smooth and peaceful nature of the 2024 general election would positively impact investor confidence.
Before the December 7 elections, the Bank of Ghana assured that it had enough dollar buffers to support the cedi, but them there were fears that the elections outcome could negatively affect the economy.
Speaking to Univers Business, Dr Samuel Worlanyo believes that the cedi could be one of the biggest beneficiaries as a result of the smooth elections.
He affirmed that once Ghana has been able to achieve a free, fair, and transparent elections, this will give a comprehensive signal to the investor community that their investment will not go wasteful.
“I believe that every investor is, whether local or international, is always on the lookout for the peaceful elections to be able to plough back their monies into the business, or being able to take proactive decisions as to whether to continue with their investments in the economy so once we have been able to achieve a free, fair, transparent elections that is quite peaceful, that gives a comprehensive signal to the investor community that their investment will not go wasteful.
“It will also be able to serve as a catalyst where they will be able to channel their resources for national development. I believe that there are thousands of investors who are willing to come into this country or transfer funds to commence business transactions in Ghana.”
He added that the appreciation of the local currency against major international currencies is expected to attract foreign investment, leading to an influx of foreign currency into the local economy.
“Well, exchange rate volatilities have to do much with the local currency appreciating against international trading currencies like the US dollar, the pounds, the euro, the CFA France, the Naira and the Chinese Yuan. Now you also realize that at this juncture that the economy has experienced a peaceful election, definitely more people will be interested in investing. The more people are interested in investing, there will be an inflow of foreign currency into the local economy and that will help us to stabilize the local currency.”
Dr. Worlanyo further revealed that the successful election would help bring down inflationary pressures as well as help stabilize the economy.
“We have artificial inflation, whereby people in all form of uncertainties and with all form of fears, tries to hold their goose because during the pre-election times, people are afraid, not really knowing what will happen so instead of them to pump more goose into the system, they decide to just release a few.”
‘This may create artificial shortage, and more money will be chasing fewer goose and increase inflation, so once that there is a stable economy, I believe the producers and the manufacturers will be able to go and produce full scale, thereby improving upon the economies and being able to produce to optimum.”
This will help us to have more goose and commodities in the open market and once the goose is more, definitely the prices continue to reduce and that may cause a reduction in the inflationary rates so definitely it is also going to affect inflation positively.”
Story by: Sarah Esinam Atiemo | univers.ug.edu.gh
