News Column

Economist Wants Ghana Currency Scrapped

August 18, 2014

Masahudu Kunateh

RENOWNED economist, Vikram Mansharamani, has urged government to scrap the use of Ghanaian Cedi as legal tender, citing the rate of the devaluation of the currency since the country's independence.

The Economics lecturer at Yale University, noted that the Cedi had depreciated 99,99 percent since Ghana's independence in 1957 and was the cause of the country's economic woes.

"A country like Hong Kong is doing well currently because it abandoned its local currency for the US Dollar, Ghana can adopt the US Dollar as its currency," he said.

The Cedi was introduced as legal tender under the presidency of Dr Kwame Nkrumah in 1965 and has been under the regulation of the Bank of Ghana.

"The Ghana Cedi has emotional attachment," Mansharamani admitted but stated that if the regulators of the currency did not have the capabilities, they should outsource it.

He cited the performance of the CFA by Francophone West African countries as evidence that Ghana could adopt another country's currency to run its economy.

However, the Minister of Communications, Dr. Edward Omane Boamah, said the government was particularly unenthused by suggestions that the Ghana cedi had fallen by 40 percent this year, insisting the Cedi has fallen by 22,9 percent instead.

According to the Bank of Ghana, the Cedi traded at 2,34 against the US dollar in January 2014, and as of August 1, stood at 3,035 to the US Dollar, reflecting a cumulative depreciation of 22,9 percent over the period.

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Source: AllAfrica

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