Former Vice President and NPP 2028 Presidential Candidate, Dr Mahamudu Bawumia, has revealed what he describes as a “hidden” conditionality under Ghana’s IMF programme that limited the Bank of Ghana’s ability to intervene in the foreign exchange market.
Speaking on Thursday at a meeting with members of the Ghana Small-Scale Miners Association in Accra, Dr Bawumia said the restriction contributed to the rapid depreciation of the cedi between 2022 and 2024.
According to him, the IMF capped the amount of foreign exchange the Bank of Ghana could use to support the cedi at a maximum of $80 million per month.
“One of the restrictions for the IMF programme that we engaged in was the amount of foreign exchange that the central bank could use to intervene to support the cedi. We were given a maximum of $80 million a month,” he told the small-scale miners.
Dr Bawumia said the restriction meant the central bank could inject no more than $960 million into the foreign exchange market annually, an amount he argued was insufficient to meet Ghana’s demand for dollars to pay for fuel, machinery, medicine and other imports.
“So, we were really constricted in terms of availability of foreign exchange. And at the same time, the cedi was depreciating almost on a daily basis.”
He said the restriction formed part of the IMF’s reserve accumulation strategy but had the unintended effect of limiting the availability of foreign exchange in the market.
The former Vice President, who was highlighting the Gold for Reserves programme, said the initiative helped Ghana build up its foreign exchange reserves, leading to the removal of the restriction in January 2025.
“Because we had built up the foreign exchange reserves through Gold-for-Reserves, that restriction was removed. And since then, the Bank of Ghana has been able to put in at least $1 billion a month in the market. From $80 million maximum per month ($960 million per year) to $1 billion a month! We couldn’t even do $1 billion a year before.”
Dr Bawumia said the increased supply of foreign exchange had since helped lay the foundation for the current stability of the cedi.
