GOGSPA say the regulations by the Central Bank are too draconian for the indigenous Ghanaian businesses, especially for those in the oil and gas industry.
1. Commercial banks were banned from issuing cheques and cheque books on Foreign Exchange Accounts (FEA) and Foreign Currency Accounts (FCA).
2. Banks were prohibited from granting a foreign currency-denominated loan or foreign currency-linked facility to a customer who is not a foreign exchange earner.
3. Furthermore, offshore foreign deals by resident companies, including exporters in the country were banned.
4. Also, over-the-counter cash withdrawals from foreign exchange and foreign currency accounts not exceeding US$10,000 shall only be permitted for travel purposes outside Ghana or its equivalent in convertible currency per person per travel.
GOGSPA in a statement issued here says it was not against steps being undertaken by the country’s central bank to save the cedi from falling and said it was in the interest of all Ghanaians to the stabilization of the local currency.
“Even though government through the central bank wish to stabilize the cedi, it is also important that they take steps to protect Ghanaian indigenous companies by giving them needed assistance/incentives to enable them operate in the industry but not to enact policies that will rather kill them,” the statement said.
The local oil and gas service providers emphasize there was high business risks associated with the forex rules as far as their business were concerned as it exposes them to huge exchange losses thereby crippling them financially.
It must be emphasized that majority of GOGSPA member companies by virtue of their businesses do chart vessels from foreign partners under stated agreements which commit them to monthly payments in United States Dollars (USD) including all associated wages and maintenance cost.
Others which do clearing and forwarding as well as equipment rental and trucking services, also face huge setbacks with the introduction of the forex rules since they offer these services to various clients in offshore and onshore for which payments have to be done by local representatives in Ghana.
Per the BoG’s new regulation, they have to buy forex for all transactions and this GOGSPA say has serious consequences on businesses and want an exemption for its members.
The statement said, “The Ghana Oil & Gas Service Providers Association (GOGSPA) is making it known to government and the Bank of Ghana (BoG) that the forex rules do not favour local companies in any way hence the need for BoG to exempt members of GOGSPA from these rules.
It will interest you to know that some members of GOGSPA who have been paid in cedis per the new forex rule, are having tough times recouping their gains, since they requested for US dollars from the banks which have no dollars to cover their forex exchange disclosures.”
GOGSPA explains the benefits an exemption of its members from the new regulations will have for the country.
“Exempting us from these rules will not only add up to shoulder the Local Content Law but will also enhance business prospects and make indigenous Ghanaian companies competitive.
There will also be continuity in businesses of members who have been affected by what we can describe as ‘draconian’ rules/policies, and will also increase productivity in the oil fields.
The exemption will also prevent indigenous companies from suffering default thereby saving redundancy,” GOGSPA said.
Source: NewsGhana.com.gh
