The Bank of Ghana’s “Letter of Commitment” (LOC) document, which Mr. Eric Kweku Hammond, a Deputy Director, Foreign Banking Operations, has encouraged exporters to use in order to facilitate their export operations.
“The LOC has become a standard document that all exporters must use in order to export their goods from Ghana, thus it is here to stay.
Every exporter “must embrace the LOC because no exporter would be able to export without it,” he said.
Mr. Hammond provided the advice during an interview with the Ghana News Agency on the sidelines of a seminar on the Letter of Commitment (LOC) document for importers, exporters, bankers, and other stakeholders in international commerce in the Upper West Region.
The goal of the seminar was to assist in addressing the difficulties associated with the LOC’s implementation for the repatriation of export revenues to enterprises.
According to him, after the LOC for the repatriation of export proceeds was introduced in 2016, the Central Bank received numerous complaints from exporters and some customs house agents about the difficulties its implementation was posing for their export businesses. As a result, the seminar had to be organized to help inform them about the benefits of its application.
He clarified that the LOC is one of several paperwork that must be approved before an exporter may ship their goods outside of Ghana.
He asserted that the LOC will assist the BOG in keeping track of all exports leaving Ghana’s borders and allow the bank to bring the exports’ earnings home.
He claimed that the Bank of Ghana required the foreign cash from these exports of goods to bolster its reserves, cover imports, and expand the nation’s infrastructure.
About 90% of the goods consumed in the nation, according to Mr. Hammond’s estimates, are imported.
“We pay for them from proceeds from the export exchange. If we don’t do something about the repatriation of foreign exchange earnings, we won’t be able to accumulate our reserves to sustain our local economies and obtain the necessary foreign cash to start our socio-economic growth through the country’s infrastructure,” he noted.
In order for the Bank of Ghana to realize its micro economy as a Central Bank, Mr. Hammond stated that the bank sought to achieve the repatriation of export revenues.
For this reason, the Bank of Ghana worked with the Ghana Shippers Authority to provide importers and exporters with information about the LOC so they could use it successfully and make exporting simple for everyone.