Address cedi depreciation immediately – GUTA tells government
The Ghana Union of Traders Association (GUTA) has asked the government to implement strict measures to stabilize the Ghana cedi.
According to GUTA, the continuous depreciation of the cedi against the dollar significantly impacts business activities, contributing to the current economic difficulties.
The local currency lost more than 14 per cent of its value between January and March 2022, a significant drop compared to previous changes.
The government had adopted periodic dollar auctions to solve the currency fluctuations, but that has yielded little results.
As a result of the development, the cost of products in the country, especially imported items, have shot up drastically.
Although various stakeholders have made some suggestions, the government is yet to comment on interventions to address the problem.
“Everything that we do is bench-marked on the dollar, and we think the government must do something about the situation. If we talk about the telcos, the oil and extractive sectors, they are repatriating their profits back at the end of the year, and you can see the chunk of monies they take from here. So, the government must look at its investment laws,” Vice President of GUTA, Clement Boateng, told Citi FM.
Meanwhile, the President of the Association of Ghana Industries (AGI), Dr Humphrey Ayim-Darke, believes that reducing the import of finished goods is in the best interests of the cedi.
This is because traders would have to convert cedi into dollars to import products, increasing the demand for dollars and raising its value.
He blamed traders importing finished goods for contributing to the struggles of the cedi.
“They put pressure on the exchange rate because they demand it for finished products…. They don’t create enough jobs, and the turnaround of their funds in the value chain is short. When you bring in raw materials, the value chain is longer,” he suggested.
In a related development, Executive Secretary of the Ghana Importers and Exporters Association, Samson Awingobit, has suggested the supply of Chinese Yuan to trading due to a large volume of imports coming from China.
“You put physical cash at the commercial bank exchanging for dollar, instead of the Bank of Ghana or the government making Chinese Yuan available,” he lamented.
“So far as this supply is coming from China, there will be no need for the dollar before you go to China. I strongly believe that that is the only way to go through. So make Chinese Yuan available in the market.” he proposed.