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Dr Jerry Monfant, an economist has described the current managers of Ghana’s economy as absolutely clueless about establishing good economic models to forestall the looming economic dangers.

The Sovereign credit rating downgrades of Ghana by Fitch and Moody’s led to “widened yield spreads on both cedi-denominated government of Ghana bonds and the country’s Eurobonds”, the Bank of Ghana has said.

The senior economist with databank indicated that, checks from some forex bureaus and commercial banks show that the cedi is gaining marginal strength against the dollar as at the time of interview, last week, as the local currency was trading averagely at GH¢7.84 to the dollar on the retail market, compared to about ¢8.06 couple of days before the Central bank’s announcement last week. However, the Bank of Ghana pegs the cedi to the dollar at ¢7.112 (mid-rate).

Dr. Cassiel Ato Forson, Ranking Member on the Finance Committee in Parliament, has cautioned the Bank of Ghana (BoG) against using the country’s net reserves to salvage the current economic crisis.

The Bank believes that, the combined package of tightening, a policy rate hike that will raise the real policy rate despite accelerating inflation, along with the withdrawal of significant Cedi liquidity from the domestic market, should have a significant impact on the currency, providing a near-term reprieve from Cedi depreciation. A simultaneous announcement that Ghana plans to borrow US$2 billion through the syndicated loan market in order to replenish its foreign exchange (FX) reserves, should further boost sentiment, helping to stabilise the currency

Besides mobile money, several factors have contributed to the emergence of e-commerce in Ghana chief among which is the level of internet penetration. According to Kepois, a social media research organization, internet penetration in Ghana is among the highest in the West African sub-region.

Bank of Ghana (BoG) has proposed using hardware wallets for its central bank digital currency (CBDC) dubbed ‘eCedi.’ The bank intends to make eCedi available for those who do not have a bank account or even internet access.

the Ghana Union of Traders (GUTA) has called on regulators of the forex market to fast-track the proposal of making the Chinese Yuan as the only trading currency when doing business with China. They believe such a move will reduce pressure on the Cedi because imports will not be done with US dollars as most Ghana’s import currently come from China because of their cheaper products and cost. 

The former Executive Director at Standard Chartered Bank, Alex Mould has said, currently the country is practising “cash accounting”, that is, “we pay as we go”. This is ok for steady payments but not good for intermittent large payments like EuroBond principal repayments. 

Another sign before Covid -19 was that instead deploying policies to support the efforts of the Bank of Ghana to manage the currency, the government usurped the constitutional mandate of the Bank of Ghana to establish exchange rate management committee which could not deliver.