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An economist, Professor William Baah-Boateng, has urged the Bank of Ghana (BoG) to focus on stabilising the cedi to prevent intermittent fluctuations. According to him, stability is the best way to safeguard the economy and help businesses plan effectively. His remarks follow the recent appreciation of the cedi after the BoG intervened in the foreign exchange market. Cedi strengthens to GH¢10.70 against US dollar In an interview quoted by citinewsroom.com, Professor Baah-Boateng said, “Stability is the best. Appreciating and depreciating are not ideal. I’m concerned about the recent movement. We were at GH¢12 and straight away we’re moving into GH¢10. When you calculate the percentage, it’s around 20%, and it will hurt some aspects of the economy while benefiting others. But overall, the economy will not benefit.” The economist noted that the recent appreciation of the cedi could reduce government revenue and negatively affect export margins, particularly in the cocoa sector. “Now that the cedi has moved from GH¢12 to GH¢10, expect that government revenue will take a hit. It will reduce the margins for cocoa exports. The appreciation will erode almost everything, and farmers will not benefit as they should,” he cautioned. Professor Baah-Boateng also emphasised that the central bank must act proactively to ensure the currency does not depreciate excessively before intervening. “I expect the Central Bank will not allow the cedi to rise and fall so sharply. When we got around GH¢10.5, we shouldn’t have allowed it to depreciate to GH¢12.5 and then come back to GH¢10.5. That kind of fluctuation is too large,” he said. Watch the latest episode of Health Focus below [embedded content]
