Prof Bokpin criticises BoG’s cedi defence policy

Economist and University of Ghana lecturer, Professor Godfred Bokpin, has criticised the Bank of Ghana’s (BoG) persistent efforts to defend the cedi, describing the policy as misguided and economically damaging.

According to him, the central bank’s obsession with maintaining a low exchange rate has imposed severe costs on the real economy, undermining liquidity, choking credit growth, and constraining private sector activity.

Speaking in a media interview, Professor Bokpin said policymakers have become overly fixated on keeping the cedi artificially strong, often at the expense of business growth, productivity, and job creation.

“Our policymakers seem too obsessed with the exchange rate, bringing it low at any cost, forgetting that what matters most is stability. Businesses and people in the diaspora are not looking for a cedi that suddenly jumps up and down; they want predictability and confidence,” he said.

Professor Bokpin noted that the tight monetary stance and fiscal consolidation measures adopted to support the cedi have worsened liquidity conditions, leaving both firms and households cash-strapped.

“There is no money for businesses or households to spend. Liquidity across the economy is drying up, and that is not sustainable,” he observed.

While acknowledging that the BoG’s interventions have helped hold the currency firm, Professor Bokpin stressed that such stability comes at a heavy price.

The billions of cedis used to sustain the exchange rate, he argued, could have been channelled into productive investments, business expansion, and job creation.

“A strong cedi that kills businesses and jobs is no success. Real stability is what gives people confidence, not an exchange rate that looks good for a few weeks,” he cautioned.

Professor Bokpin warned that Ghana’s leaders have turned exchange rate management into a political trophy, chasing short-term applause while eroding the country’s productive capacity.

He called for a shift in focus from cosmetic currency gains to genuine economic progress built on the pillars of employment, production, and value creation.

“We need to move beyond short-term currency optics to policies that truly strengthen the economy. Our goal should be a resilient economy, not just a temporarily strong cedi,” Professor Bokpin urged.