Ghana's Cedi in Crisis: Central Bank Grapples with Dollarisation and Currency Abuse

Published 1 month ago3 minute read
Pelumi Ilesanmi
Pelumi Ilesanmi
Ghana's Cedi in Crisis: Central Bank Grapples with Dollarisation and Currency Abuse

The Bank of Ghana (BoG) is intensifying its campaign to foster respect for the national currency, the cedi, with officials cautioning Ghanaians about the severe economic and operational ramifications of mishandling it. This initiative coincides with the upcoming "Cedi@60" celebration, marking six decades since the cedi's introduction as a symbol of Ghana's economic independence and national pride.

Dominic Owusu, Director and Head of Currency Management at the BoG, underscored the dual impact of poor currency care on both technology and the nation's image. He explained that dirty or damaged notes impede modern cash-handling technologies, like counting machines, thereby reducing operational efficiency. Economically, Mr. Owusu highlighted that Ghana does not print the cedi domestically using local currency but relies on foreign exchange, specifically the dollar. Consequently, any mishandling of the cedi directly contributes to its depreciation and incurs significant costs to the nation, as damaged notes require expensive replacement.

Mr. Owusu also criticized common cultural practices, such as crumpling notes when giving gifts, questioning its origin and persistence. He warned that such actions destroy the protective qualities of banknotes, causing irreversible damage that becomes a financial burden to the country and tarnishes its international image and dignity. He further asserted that the physical condition of a nation's currency significantly influences first impressions from visitors and mirrors the quality of life of its citizens. To reinforce this message, he introduced the slogan "Clean Cedi, Clean Country – CCCC," urging the public to refrain from writing on, stapling, or folding banknotes to extend their lifespan and reduce central bank costs.

The "Cedi@60" celebration is officially slated for Tuesday, October 29, 2025, at the Accra International Conference Centre (AICC). Beyond commemorating the currency's anniversary, the event aims to deepen national pride and address the increasing trend of dollarization within the Ghanaian economy, as stated by Bernard Otabil, Head of Communications at the BoG.

Mr. Otabil emphasized that the celebration serves to reinforce the cedi's status as Ghana's sole legal tender, highlighting its importance as a national heritage. A primary objective is to encourage all citizens and businesses to conduct transactions exclusively in cedis, thereby enhancing the effectiveness of monetary policy and contributing to economic stability. He noted that the "transmission mechanism works well if we do not have the overwhelming impact of exchange rate pass-through effects on our currency or economy."

Expressing concern over the public's intense focus on exchange rate fluctuations, which he believes can fuel speculation and erode confidence in the local currency, Mr. Otabil stated that the Cedi@60 launch would initiate a series of activities planned for the following year. These activities are designed to bolster public confidence in the national currency and raise awareness of its intrinsic value.

Ultimately, both BoG officials urged citizens to view the cedi as a symbol of national pride, identity, and dignity. Maintaining the integrity of the currency is presented as a fundamental civic duty, crucial for Ghana's economic stability, operational efficiency, and overall national image.

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