The Ghana Union of Traders Association (GUTA) has expressed worry over the state of the cedi.
In a statement signed by its president, Dr Joseph Obeng, the association said the cedi depreciation has created a mess for the business community, especially the trading sector.
GUTA added that the economic crisis and the ever-rising freight charges from Asia are making business unbearable.
“The current state of affairs has far-reaching implications and has caused prices of goods and services to increase for the consuming public.”
GUTA recounts how the inflationary pressures resulting from the depreciating cedi have pushed the cost of goods through the roof, making it increasingly difficult for businesses to stay afloat.
“The purchasing power of the consuming public has been affected, thereby reducing the turnover of businesses”.
According to GUTA, its members are unable to repay loans taken from banks to support their operations.
It added that the rising freight charges, compounded by customs duties bench-marked in dollars at the port, are crippling trade and commerce, leading to untold hardship for businesses and consumers alike.
“The value of credit purchase increases, thereby making it very difficult for traders to repay the goods bought from their overseas suppliers, leading to higher indebtedness to businesses”.
“GUTA hereby calls on the government to take urgent measures to save this alarming situation from getting out of hand”, the statement said.
As of the close of business on Monday, May 13, 2024, the cedi was going for GH₵14.80 at forex bureaus while the British pound was going for GH₵18.20.
The Euro, on the other hand, was going for GH₵15.80.
Consequently, economist, Prof Godfred Bokpin, says the Ghana cedi can only be stabilised temporarily from further depreciation in its performance against major foreign currencies.
Prof. Bokpin believes the cedi’s lack of robust macroeconomic policy support has occasioned this trend.
He explained that the cedi has persistently suffered depreciation since its introduction in July 1965.
He anticipates intermittent periods of relative stability but underscores the likelihood of continued depreciation, even with optimal economic measures in place.
“If we do everything right, we will still expect that the cedi will depreciate by a certain margin given the relative strength of the economy.
However, Finance Minister, Dr Mohammed Amin Adam says there has been a slower rate of depreciation for the cedi this year compared to the previous year.
Despite recent pressures on the local currency, Dr Adam highlighted that the cedi’s depreciation year-to-date stands at 12%, significantly lower than the 27% depreciation recorded in the same period last year.
Dr Adam said this when addressing attendees at the opening ceremony of the 2024 3i Summit in Accra on Monday, May 13.
He reassured Ghanaians of the government’s commitment to curbing the depreciation of the cedi.