Legislators from the English-Speaking countries in West Africa have begun a five-day regional forum to deepen their knowledge on the global financial crisis and to help shape policy options to meet the challenges.
The workshop, organized by the West African Institute for Financial and Economic Management (WAIFEM), is to enhance the knowledge and skills of legislators to appreciate the causes and effects of the global financial crisis on domestic economies and develop policy options to meet the challenges.
It is also to strengthen the capacity of legislators to play their roles more effectively in enacting appropriate legislation geared towards the realization of national and regional development goals within the current globalized economic environment.
The broad themes to be covered at the workshop include an overview of the 2008 global financial and economic crisis, challenges facing the legislation under the global financial crisis, impact of the global financial crisis on commodities, remittances, foreign direct investments and aid as well as its effects on technology transfer, employment, growth and poverty levels.
In a speech read for him at the opening session, Dr Paul Acquah, the governor of the Bank of Ghana, said although the banking sector had performed well in the past few years, backed by improved macroeconomic stability and legislative reforms, the sector could still be vulnerable to the effects of the crisis and the economic recession.
He said a major concern to people and investors in the sub-region is the extent of the crisis on trade, foreign direct investment, remittances inflows, among others.
There are projections that with the collapse in global demandand commodity prices, export revenues in mineral-rich African countries will decline sharply and foreign aid might also dip as aresult.
In responding to the crisis, Dr Acquah said the governments inthe region must take steps to maintain macro economic stability and also encourage investments that would help diversify the economy and provide safeguards to the vulnerable segments of society.
"Maintaining macroeconomic stability is critical to ensure that the domestic economy remains attractive to both domestic and foreign investors for the long-term growth which is necessary to reduce poverty," he said.
Dr Acquah said a critical challenge would be how to sustain stability and mitigate falling domestic demand within the constraints posed by scarce financial inflows, urging that these must be done in line with medium term stability and development goals.
He said while some of the causes of the global crisis stemmed from poor oversight of regulatory authorities, legislators and financial regulators must play their roles adequately to ensure transparency in the transactions players in the financial markets undertake, especially off-balance sheet transactions.
This, Dr Acquah said, could be done through enhanced vigilance and interaction with the domestic financial system and adherence to supervisory guidelines and enhanced information flows between banks and the central bank.
"A highly enhanced regulatory and supervisory oversight of the financial system remains the key plank to ensure that the region's financial sector is insulated from the ongoing and unfolding global financial crisis," he added.
Source: Xinhua
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