The Ghana International Trade and Finance Conference (GITFiC) has raised concerns about the depreciation of the local currency despite several interventions by government.
The Cedi is said to have depreciated marginally in the first quarter of 2024 despite a strong showing in 2023.
“GITFiC has observed the current trend and can say on authority that one of the main mechanisms negatively affecting the appreciation of the Ghanaian cedi against the major trading currencies is the fact that the country is seeing more repatriation of profits by foreign-owned companies than ever,” the finance analysis organisation said in a press release on Monday, February 26.
“This phenomenon is not new; however, it is characterised by market speculation, which is largely accounting for the current negative trend,” it added.
Recently, the immediate past Minister of Finance, Ken Ofori-Atta, announced a $200 million injection into the economy.
GITFiC says the move will yield no result because the companies usually build their projections on that.
“The announcement by the immediate past Minister for Finance on the expected 200 million USD injection into the Ghanaian economy may not yield the necessary result because, by the mere pronouncement of such expected intervention, operators in the market build such pronouncements into their projections even before the money arrives.
“This makes the government’s effort counterproductive in this regard.”
GITFiC is recommending that the Bank of Ghana injects forex into the economy “without hesitation”.
“The expected 200 million USD, as announced by the immediate past minister for finance, should be deliberately targeted at specific reactionary areas to give the Ghanaian cedi some respite.
“The Central Bank of Ghana should not relent but continue to weed out dubious forex operators from the market, tighten their regulations, and enforce strict compliance across the board.”