Dr. Mahamudu Bawumia, the flag bearer of the New Patriotic Party, has stated that the Cedi’s value has improved compared to the time it was valued during the National Democratic Congress (NDC) regime.
Dr. Bawumia emphasized his viewpoint on stabilizing the value of the Cedi and the currency’s resiliency under President Akufo-Addo in an interview with AfricaWatch Magazine.
He said that the depreciation of the Cedi has been handled well in spite of the continuous problems with the global economy, particularly in comparison to the previous NDC government.
“Why not? Averages are a common tool used in statistics and economics to gauge progress. The handling of the exchange rate under our government and under the NDC government can be fairly compared. The point is that, despite the significant national and international difficulties we have faced, it is amazing that, from 2009 to 2016, the average rate of depreciation of the currency was 13.9%; yet, from 2017 to 2023, it averaged 13.1%. That is true, according to Dr. Bawumia.
According to the data, the cedi’s cumulative depreciation was 71.1% between 2009 and 2016 and 64.6% between 2017 and 2023. Therefore, despite the tremendous global shocks we have experienced, the cedi has depreciated less during our government when looking at the average or cumulative figures. That is the basic truth.”
In addition, Dr. Bawumia defended a statement he made during the NPP’s 2016 campaign, restating his belief that, when its foundations are strong, an exchange rate accurately represents the strength of a government.
He linked the volatility of the current currency rate to international issues like the COVID-19 pandemic and the conflict between Russia and Ukraine.
Without a doubt! I will stick by my assertion since it is still accurate. We saw that the exchange rate was reasonably stable between 2017 and 2021 while the fundamentals—the budget deficit, inflation, GDP growth, external balances, and international reserves—were fairly good, the speaker remarked.
“But following the COVID-19 pandemic, the Russia-Ukraine war, the banking-sector crisis, the excess-capacity energy payments, and the lack of access to international capital markets, the fundamentals of the economy were weakened, and the fiscal deficit and debt levels increased.
“Inflation reached some 53% at the end of 2022 and you saw the exchange rate depreciate by some 30% in 2022. The fundamentals have strengthened recently, with the declining fiscal deficit, declining inflation, improved external reserves, and so on, and this has resulted in relative stability of the exchange rate. So, my statement still holds true.”