Dr. Mahamudu Bawumia, the New Patriotic Party (NPP) flagbearer, has unveiled a strategic plan to stabilize the Ghanaian cedi using the nation’s gold reserves if he wins the presidency in the December 2024 elections.
His proposal aims to curb the cedi’s persistent volatility, boost investor confidence, and strengthen Ghana’s economic stability.
Over recent years, the cedi has significantly depreciated, fueling inflation and diminishing citizens’ purchasing power. This instability is largely due to external factors like global commodity price fluctuations, the strong US dollar, and Ghana’s trade deficits.
To combat these issues, Dr. Bawumia suggests leveraging Ghana’s abundant gold reserves.
During a meeting with Organised Labour, Dr. Bawumia emphasized the need for a stable anchor for the cedi. “We need to back our currency with gold. This will bring much-needed stability to the exchange market. Currently, we lack an anchor, but with gold, the cedi’s value will reflect the stable value of gold,” he explained.
As one of the world’s leading gold producers, Ghana’s mining sector is crucial to its economy. Utilizing gold reserves to back the cedi could provide a more stable foundation, reducing the currency’s exposure to external pressures.
