Parliamentarians from English- speaking countries in West A frica on Monday began a forum to discuss the global financial crisis and to help shape policy options to meet its challenges.
The five-day workshop being organized by the West African Institute for Financia l and Economic Management (WAIFEM) is to enhance the knowledge and skills of leg i slators to appreciate the causes and effects of the global financial crisis on d o mestic economies and develop policy options to meet the challenges.
It is also to strengthen the capacity of legislators to play their roles more ef fectively in enacting appropriate legislation geared towards the realization of n ational and regional development goals within the current globalized economic en v ironment.
The broad themes to be discussed include an overview of the 2008 global financia l and economic crisis; challenges facing the legislation under the global financ i al crisis; impact of the global financial crisis on commodities, remittances, fo r eign direct investments and aid as well as its effects on technology transfer, e m ployment, growth and poverty levels.
The governor of Ghana’s central bank, Dr Paul Acquah, said although the banking sector had performed well in the past few years, backed by improved macroeconomi c stability and legislative reforms, the sector could still be vulnerable to the e ffects of the crisis and the economic recession.
He said in the speech read for him that a major concern to people and investors in the sub-region was the extent of the crisis on trade, foreign direct investme n t and remittances inflows, among others.
There are projections that with the collapse in global demand and commodity pric es, export revenues in mineral-rich African countries will decline sharply and f o reign aid might also dip as a result.
Dr Acquah said the Governments in the region must take steps to maintain macro e conomic stability and also encourage investments that would help diversify the e c onomy and provide safeguards to the vulnerable segments of society.
“Maintaining macroeconomic stability is critical to ensure that the domestic eco nomy 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 mitiga te falling domestic demand within the constraints posed by scarce financial infl o ws, adding this must be done in line with medium-term stability and development g oals.
He said while some of the causes of the global crisis stemmed from poor oversigh t of regulatory authorities, legislators and financial regulators must play thei r roles adequately to ensure transparency in the transactions players in the fina n cial markets undertook, especially off-balance sheet transactions.
This, Dr Acquah said, could be done through enhanced vigilance and interaction w ith the domestic financial system and adherence to supervisory guidelines and en h anced 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 f rom the ongoing and unfolding global financial crisis,” he added.