Over the past month, Ghanaians have witnessed a sharp appreciation of the Cedi. All the major trading currencies, especially the US Dollars, are now being humbled by our currency – causing ripples of excitement across radio shows, social media, and street corners. In a country where exchange rate movements are treated with the same passion as Black Stars matches, the recent cedi performance is naturally triggering political bragging rights.
With the NDC back in office for less than six months, some supporters have already crowned Dr. Cassiel Ato Forson the miracle worker. “What Bawumia and Ofori-Atta couldn’t do in 8 years, Ato Forson has done in 6 months!” is the new anthem of partisan pride. But while we celebrate with dancing emojis and #CediIsBack hashtags, let’s take a breath – and a glance into our rearview mirror.
Because we’ve been here before.
Déjà vu, Anyone?
In President Mahama’s first term (2012–2016), Ghanaians saw similar episodes. At one point in 2014, the cedi lost nearly 40% of its value – then made a dramatic comeback after the Bank of Ghana injected dollars and tightened monetary policy. The then Finance Minister, Seth Terkper, even launched the now infamous “Home Grown Policies” programme – celebrated by some, criticized by others, and followed by an IMF bailout.
Each time the cedi gained strength, we thought the corner had been turned. Each time, the dollar eventually reminded us who was boss.
Even under the Akufo-Addo/Bawumia administration, the cedi had its brief “honeymoon” phases – especially after Eurobond inflows, syndicated cocoa loans, or IMF disbursements. The currency appreciated, optimism surged, but then came the reversals. These were not failures of specific finance ministers alone – they were reflections of a structural vulnerability that runs deep in the Ghanaian economy.
Political Football or Economic Fundamentals?
The temptation to turn every uptick into a partisan football match is strong. We know the rules: If the cedi falls, blame the Finance Minister. If it rises, crown him saviour. But currency strength isn’t the product of charisma or political proximity to President Mills’ ghost. It’s about fundamentals, market confidence, and often, external factors we can’t control.
No doubt, the new finance minister deserves credit for calming the markets. His tone has been measured, his statements less performative than his predecessors’, and his initial actions suggest an effort to restore fiscal discipline. That said, the real test will come in:
- Managing debt repayments without mortgaging future revenues;
- Growing domestic production to reduce reliance on imports;
- Expanding the tax base without stifling growth;
- And reforming institutions to prevent future macroeconomic shocks.
Can the NDC administration resist the political pressure to over-spend ahead of elections? Can it negotiate smartly with the IMF, without triggering public backlash or social unrest? Can it shield the poor while implementing structural reforms?
That’s where the actual battle lies – not in the month-to-month dance of the exchange rate.
What Are the Real Indicators?
Is inflation down sustainably? Are we exporting more than we import? Is the tax base broadening? Are we reducing our debt-servicing burden, or merely refinancing it? These are the indicators that will tell us whether this cedi appreciation is a trend or a teaser.
We’re also yet to see the full fiscal picture. The mid-year budget will be the real test of Ato Forson’s strategy. Will he cut politically costly subsidies? Will he resist the temptation of printing money to fund populist programmes? Will he negotiate with external creditors and investors in ways that secure both debt relief and investor confidence?
These are not six-month miracles. They are long-haul battles. And even a sharp appreciation, while psychologically soothing, can come with side effects — for example, harming export competitiveness or disincentivising diaspora remittances.
A Time for Humility, Not Hype
Ghana’s economic story is complex. The cedi’s behaviour is not an emotional teenager reacting to the Finance Minister’s tone of voice; it is a reflection of deep-rooted structural issues, geopolitical dynamics, and market sentiments.
If history teaches us anything, it is that premature jubilation often precedes disappointment. So, while we appreciate the short-term gains — and God knows we needed some good news — we must resist the urge to confuse symptom relief with full recovery.
Dr. Ato Forson may well prove to be one of Ghana’s most effective Finance Ministers. But let’s give him the space and time to actually do the work, not just benefit from a temporary upswing and social media applause.
As the saying goes, “When the rain drizzles in the dry season, don’t start planting your maize just yet.”
So to my fellow Ghanaians, breathe… but don’t break into azonto just yet. The economic battle isn’t won on the forex charts of May 2025. It’s fought — and won — in the policies, institutions, and choices that shape the months and years ahead.
Dr. Asiamah's Gazette 