The ongoing attempts to stop the chronic devaluation of the cedi against the major trading currencies, according to Finance Minister Ken Ofori-Atta, will soon start to bear fruit.
He claims that the Bank of Ghana has taken some action to address the issue affecting the cost of living in the nation.
On September 28, Ken Ofori-Atta provided an overview of the steps being taken to stop the devaluation of the cedi, including a Special Foreign Exchange Auction for bulk distribution businesses and a Gold Purchase Program.
“As part of measures to shore up our reserves, improve exchange rate stability and address some of the funding needs, the Ministry successfully worked on a US$750 million Afreximbank loan facility which was received in August 2022,” he explained.
“The traditional Cocoa Syndication Loan, expected in the last quarter of 2022 which will promote the cocoa sector, will further help us build our FX reserves and provide a strong buffer for the cedi in the last quarter of the year,” Ken Ofori-Atta added.
The local currency has since the start of this year significantly lost its value against major trading currencies, especially the US dollar.
The cedi is currently selling at around GH¢10.00 to the US dollar on the forex market – a situation which has impacted the currency’s performance and resulted in a high cost of living.
Demand for forex has also overtaken supplies during a period when high debts and low investor confidence have made it impossible for Ghana to access the international capital market for borrowing.
As at July this year, the cedi lost its value by more than 20 percent to the US dollar.
In addition, recent economic downgrades by international rating agencies such as Fitch and Standards & Poors’ has also impacted the investor community at large, while Ghana awaits an IMF support programme which is expected to be accessed in 2023.