BBC, Bloomberg Decry Cedi As “Worst-performing Currency” -As One Dollar Hits GHC 10

The free-falling Ghana cedi has attracted a dread euphemism from the mainstream international media. BBC describes it as a “currency slump” while Bloomberg estimates it to be the worst-performing worldwide.

Bloomberg has classified the Ghana cedi as the second-worst performing in the world in a currency performance ranking that places the cedi just a step ahead of the Sri Lankan rupee – the authentic worst performing currency owned by a country whose economy has totally collapsed and is on life support.

The weighted phrases by these mainstream media organisations are usually is a signal that investors have virtually lost hope in the cedi.

“Ghana Central Bank plans emergency meeting after currency slump,” the BBC reported about the emergency meeting of the Bank of Ghana Monetary Policy Committee, which hiked the Prime Rate to 22% from 19% to stop inflation.

But critics say the measure is bound to fail on arrival.

Meanwhile, the currency slump as described by the BBC does not mean the “slight inflationary challenges” that the Akufo-Addo government is making the crisis to be.

Currency slumps usually refer to a situation where hyperinflation has placed a currency on a firm footing for justifiable demonetization.

A recent example of a serious currency slump is the eventual demonetization of the Zimbabwean dollar in 2015 after it had become useless through hyperinflation.

Interestingly, Ghana’s Vice President, Mahamudu Bawumia, who is head of Akufo-Addo’s economic management team had been hired at a point to allegedly “arrest” the slump of the Zimbabwean dollar but failed miserably to do so.

With Ghana’s economy tanking under a debt conundrum and investors leaving with their monies, there are fears that Ghana could go the way of Zimbabwe.

In such a scenario, the cedi will be demonetized and citizens will have to use currencies from other countries, most likely, the US dollar.

Between January 2022 and August 2022, the cedi has depreciated by more than 50 percent against the dollar under the watch of the Akufo-Addo government. In January a dollar was retailing for Ghc6. But, as of Friday, August 19, the dollar was retailing at Ghc10.

And the mess has been squarely placed at the doorsteps of the Akuffo Addo government which has had a penchant for reckless borrowing since 2017.

The debt-guzzling government has escalated the country’s debt from Ghc122 billion in 2017 to almost GHC 400 billion, or some 84% of GDP.