The dancing state of the cedi is cause for concern. We should not continue to close our eyes to one of the critical reasons why we are in the state we are today.
We regret to be blunt about the matter under review.
The Bank of Ghana has reneged on its regulatory functions. The apex bank’s Governor, Dr. Ernest Addison, at the 118th Monetary Policy Committee press conference in Accra last Monday, warned against speculative comments about the local currency, adding, “stop engaging in speculative purchasing and the comments.”
Quite late in the day, Dr. Addison is now seeking compliance with the regulations in the foreign exchange market. We do not know what Dr. Addison hopes to achieve by the setting up of a task force to boost regulatory compliance by monitoring all the foreign exchange bureaux in a bid to contain the depreciation of the cedi.
What worries us is the admission by the Governor that the Bank of Ghana was aware of the activities of the illegal operators in the foreign exchange market. Mr. Governor, if you are aware of the activities of the black market operators, why have you turned a blind eye to their nation-wrecking operations? You have been sleeping on your job, and we urge you to be up and doing or be shown the exit for non- performance.
Again, we are surprised that all this while, you are now warning foreign exchange operators to desist from advertising rates outside their premises or on social media. Mr. Governor, you know more than we do that in even the most liberalised economies, the foreign exchange market is a regulated one.
Nobody dares to just put a table anywhere to start trading in foreign currencies like we do in Ghana. We have allowed these operators of the foreign exchange market including foreigners to hold us to ransom. While the cedi is “misbehaving” on the market, the interbank rates are within business-friendly limits.
We think that the cedi is not the vegetables and food crops to be traded on the open market.
It must be a regulated market and only those with license allowed to trade in it. Dr. Addison, until you crack the whip on the undesirables in the market or to put it in your own words, “sanitise the market”, the cedi would continue to dance to the tune of speculators and commentators such as NDC politicians who miss no opportunity to predict the cedi rate at any given time.
To the NDC, the poor performance of the cedi would inure to its electoral advantage on December 7, because John Mahama and his naysayers lack the policy initiatives to convince the electorate.
Be that as it may, the Governor of the Bank of Ghana has the obligations to reverse the free fall of the cedi by addressing the weak fundamentals, major among them is a strictly regulated foreign exchange market where illegal operators have no breathing space.