Cedi’s performance good for Ghana’s economic credential
September 8, 2020
The level of economic performance in any country greatly helps to influence how strong the nation’s currency is. If the economy is strong and can withstand external shocks, it will be able to stabilize its currency. On the other hand, if it is a weak economy, it will not be able to withstand external shocks, and this will go to affect the value of the currency. What makes a powerful and strong currency greatly depends on the rate of international market demand, and this explains why we need to understand the use of the US dollar and the British pound as standard currencies for measuring other currencies.
Indeed, a global currency is one that can be used for all kinds of transactions in the world. As an example, the US dollar is used in foreign exchange transactions worldwide. It constitutes 64 per cent of all foreign exchange transactions worldwide, and it is for this reason that the US currency is used as a standard for measuring other currencies within this context. It must be understood that the Ghanaian cedi is also performing very well, especially when weighed against the US dollar.
In Africa, the strongest currencies are the Libyan dinar followed by Tunisian dinar and the Ghanaian cedi, in that order. Indeed, Ghana is the only West African country among the top five currencies in Africa.
According to available information from the African business experts, Business Insider, the cedi is more valuable because of the country’s GDP per capita, which is also the largest in West Africa. The Moroccan dirham and Botswana’s pula follow in the fourth and fifth positions respectively. All these go to show that the Ghanaian economy is not as bad as one might think, in spite of the COVID-19 pandemic, which has devastated many economies in the world. The Ghanaian economy, having spent huge sums to offer help to the people in terms of supply of free water and electricity, free SHS and other huge expenditures in the form of packages for people in the country, is still relatively strong.
The cedi has been able to withstand external pressure compared to other countries in Africa and the rest of the world. This shows that government economic policies are on the right path and must be rigidly continued to ensure that, as much as possible, things improve for the better. With carefully thought-out economic policies and their implementation, it is expected that the country will soon become the leading or strongest economy in Africa. Already, Ghana’s economy is one of the fastest-growing economies not in Africa alone, but also in the world as a whole. The country is able to do this because of its export-oriented policies like Planting for Food and Jobs and other good policies.
The people of this country will need to support such policies, so as to ensure that the ultimate purpose of economic growth is attained for the benefit of everyone in the country. This is how we can make socioeconomic life comfortable for everyone in the country.