Dr Ismael Dodoo advocates for commodities trading as new revenue source for Government
African Human Development Expert formerly with the United Nations Development Programme (UNDP), Dr Ishmael Nii Amanor Dodoo, has bemoaned the lack of innovation on the part of the Government in creating new financing pathways for its constantly ballooning expenditure.
The Human Development Expert notes that the government needs to find innovative ways of making new revenue and reduce its over-reliance on traditional sources of financing mechanisms such as Treasury Bills.
Speaking during the NorvanReports and Economic Governance Platform (EGP) X Space Discussion on Sunday, and reacting to an assertion by Prof Lord Mensah on the possibility of the Government refinancing T-Bills with subsequent issuances of T-Bills if the demand for the debt instruments continue unabated, Dr Dodoo quipped a refinancing of T-Bills with T-Bills is not the right way to go.
“Government using T-Bills to pay T-Bills which then becomes a cycle and hoping it becomes an ecosystem that feeds itself, really, is not the right thing to do,” he remarked.
The X Space Discussion was on the topic, “Are Government T-Bills and Bonds Risk-Free?”.
According to Dr Dodoo, the Government can be innovative as China has been and create financing instruments in its commodity trade with other nations.
This, when done by the Government, he noted, will enable the Government to plow back as revenue part of the billions of dollars circulating in the commodity trading between the country and other nations.
“The Government has not been innovative about commodity trading, as a country we import almost every commodity, and yet the Government hasn’t found a way to tap into this sector and generate revenue.
“Government can tap into the value chain of the commodity trading between the country and other nations and create financial instruments that allow it to plow back some of the money in the value chain of the international trade of these commodities between Ghana and other nations,” he quipped.
The country currently operates an under-developed commodity exchange which has the Government of Ghana as the sole shareholder.
The objective of the exchange is to establish linkages between agricultural and commodity producers and buyers locally to secure competitive prices for their products, assuring the market quantity and quality as well as timely settlement of their trade.
According to the Ghana Commodity Exchange (GCX) on its website, the GCX offers tremendous opportunities for Ghana and West Africa’s exports and creates new opportunities to increase Ghana and West Africa’s competitiveness in global markets.
Further stating that, the GCX aims to promote the commercialization of Ghana and West Africa’s agricultural sector, improve market access, increase market efficiency, and lower transaction costs.
