Traders should buy gold in Cedis; dollarization of Ghana’s economy bad – Economist

Traders should buy gold in Cedis; dollarization of Ghana’s economy bad – Economist
Traders should buy gold in Cedis; dollarization of Ghana’s economy bad – Economist.

Trading in dollars within the Ghanaian economy is bad because it weakens the local currency, the Cedi, Chairman of the Greater Accra Regional branch of the Association of Ghana Industries (AGI), Mr Tsonam Akpeloo, has said.

In his view, measures should be instituted by managers of the economy to protect the Cedi against the major trading currencies especially the dollar.

Speaking at the 3businesscolloquium organized by Media General in Accra on Wednesday July 6, he said quoting in foreign currencies must reduce to shore up the Cedi.

In his concluding remarks during the event, he said “The first thing I will like to mention has to do with how we can Ghanaian the economy, how we can entirely make our economy Ghanaian.

“You hear around every time quoting in dollars, hotels and everything has been dollarized. How can you grow with that? Let us protect our space, let us protect our cedi.

“The only way we do that is, when the president comes on TV to read the statement he should never mention the dollar, he should quote every figure in Ghana Cedi.

“Look at our gold industry is, Ghana is touted to be one of the biggest producers of gold. So where is the gold money? It has been dollarized ,people come and take the gold away, gold rate should be made in Cedi, we should be able to buy gold in cedi and we should have only one mechanism where we channel our gold proceed. That way we can more of the money being retained here.”

For his part, Director of Research at the Institute of Economic Affairs (IEA) , Dr John Kwakye said that stabilizing the exchange rate in Ghana is all about export and how much is being derived from it.

In his view, it is not the function of the Bank of Ghana (BoG) to control exchange rate because the central bank does not determine exports.

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Dr Kwakye indicated that persons who blame the BoG for not stabilizing the rate may be speaking out of ignorance.

Currently, the dollar is trading at 8 Cedis.

He said “The exchange rate is not about monetary policy alone. When people blame Bank of Ghana for not stabilizing the exchange rate, I see that they don’t understand.

“Bank of Ghana alone cannot stabilize the exchange rate, it is about how much export we are producing as a country , how much ae we earning from exports, that one bank of Ghana doesn’t determine it. Of course they can help, they have to work with government to put in polices to do do that. Bank of Ghana just manages the reserves that we all we receive.”