Cedi surge may hurt exports, threaten growth – Prof. Baah-Boateng warns

Economist and University of Ghana professor, William Baah-Boateng, has cautioned that the rapid appreciation of the Ghanaian Cedi, while encouraging on the surface, could have unintended consequences for the economy, particularly for exports and domestic production.

His warning follows recent gains by the Cedi, which has strengthened significantly against major currencies.

The interbank rate now stands at GH¢13.29 to the US dollar, an improvement from levels above GH¢16 earlier this year.

In an interview on Monday, May 12, 2025, Prof. Baah-Boateng called for caution, noting that the swift pace of appreciation could disrupt economic balance.

“My concern is that the appreciation is very sharp. When it happens that quickly, it raises red flags about potential volatility and hidden risks,” he stated.

While a stronger Cedi can help lower import costs, he warned that it also makes Ghanaian exports less competitive on the global market, reducing earnings for exporters and discouraging export activities.

“Appreciation tends to encourage imports and discourage exports. Exporters may start losing revenue, and if that trend continues, they might abandon exports in favor of imports, which is not healthy for the economy,” he explained.

He further warned that a surge in imports could undercut local industries, as domestic producers may struggle to match the lower prices of imported goods.

“Local producers operate with relatively higher costs, so when cheaper imports flood the market, they face stiff competition. This could weaken domestic production and ultimately undermine economic growth,” he added.

Meanwhile, the Ghana Union of Traders’ Association (GUTA) has urged its members to adjust their prices downward in response to the Cedi’s appreciation, signaling potential relief for consumers in the short term.