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However, for those whose activities and livelihoods are related to the above-mentioned activities, the loss of value of the Cedi in relation to the greenback poses a problem and continues to be a problem.
On Friday, bank customers who went to the bank with US dollars to exchange them for cedis sold it at 5.20 GH ¢, while those who wanted to buy the dollar with cedis sold one at 5.60 GH .
In 2008, a trader paid a Ghanaian cedi for one US dollar, but in early April 2012, the same trader traveling abroad paid 1.74 GH ¢ for one US dollar.
In addition, between January 2018 and January of this year, the cedi is depreciated by 11%. The local currency is sold at 4.91 GH ¢ for a dollar on the interbank foreign exchange market until it reaches 5 GH ¢.
The depreciation of the cedi has been hard hit by importers of goods and services of all kinds, who have had to look for more cedis to ship their shipment or take advantage of the services provided in the country, including the aftermarket merchants. In all this, the additional cost due to the depreciation is pbaded on to the people who buy the products. This remains an albatross on the neck of most companies, including those of the Association of Ghana Industries.
Factors
A number of factors contribute to the depreciation of the local currency against the dollar, despite political badurances. Among these are the exodus of capital, which can be described as the rapid movement of large sums of money out of a country.
In the case of Ghana, for example, there are a number of large multinationals operating here as well as individual companies that import and sell.
Since they are all investors looking for profits, whenever they realize sales in Ghana Cedis, they convert Ghana Cedis into dollars and have no choice but to repatriate these huge sums of money to their respective countries of origin.
This means that any money the government gets and injects into the economy to support the local currency is immediately swallowed by cedis exchanged for dollars and shipped out of Ghana.
What the experts say
According to experts, factors such as the economic situation of a country, monetary policy and world market conditions have a regular impact on currencies. There is also the fact that when the global demand for a country's exports is low, the value of its currency decreases.
In order for Ghana to be able to cope with the dollar's flight, whatever party is in power, we need to keep a lot of capital in the country, which can happen when local businesses manage to attract strong local patronage, to export more. their products to neighboring countries and, by extension, the diaspora.
1D1F
It is to try, among other things, to stop the situation, that the government has adopted the policy of One District One Factory (1D1F), which aims to ensure that the creation and operation of private companies strongly owned by In each district, indigenous people are highly dependent on imports through the sale of products in the local market and in the sub-region, thus helping to overcome the constant groping of the local currency.
Government solution
It will be remembered that on Wednesday, the government gave badurances that it would adopt a number of measures, within the next two weeks, to reverse the depreciation of the cedi.
On Friday, the cedi gained a marginal strength in its competition with the dollar.
Finance Minister Ken Ofori-Atta told parliament that he was "very confident that the reversal will occur and make the cedi stable,"
He announced that the government was to receive $ 900 million in revenue from COCOBOD, $ 3 billion from the Eurobond launched last year and an additional $ 750 million in bridge financing.
This was after the House had concluded a debate on the government's request for a $ 2 billion G ¢ sovereign guarantee for the Ghana Amalgamated Trust (GAT) Limited to support Ghana's indigenous banks.
Dependence on import
However, the finance minister said the challenge was to manage the country's imports while boosting exports, adding that the country needed to change its dependence on imports, "otherwise we will still fight this problem", regardless of what the party was in power.
Interventions up to now
Last year, he said the central bank had to intervene with $ 1.8 billion while for the first quarter of this year, the government had already injected $ 90 million.
He wondered how the cedi should depreciate after the government's efforts to stabilize the economy, including the achievement of a single-digit inflation.
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