Chief Executive Officer of Dalex Finance, Mr Joe Jackson, has warned that Ghana’s currency will continue to face downward pressure unless decisive reforms are implemented to increase domestic ownership of the country’s natural resources.
He challenged the widely held view that the depreciation of the Ghana cedi is largely driven by excessive imports, describing it as a misleading narrative that obscures deeper structural issues within the economy.
Mr Jackson made these remarks at a public engagement organised by the Chartered Institute of Marketing Ghana (CIMG) in Accra, under the theme: “Ananse Stories About the Ghanaian Economy.” The programme forms part of CIMG’s professional development series aimed at enhancing public understanding of economic trends and challenges.
He explained that despite Ghana recording a trade surplus of more than US$5 billion in 2024, the cedi continued to weaken because a significant portion of export earnings did not remain within the domestic economy.
According to him, substantial foreign exchange leakages through service payments, profit repatriation, debt servicing, and capital flight have eroded the benefits of increased export volumes.
Mr Jackson noted that the mining sector accounted for a major share of these outflows. He said although gold exports were valued at approximately US$11.9 billion in 2024, Ghana retained only about 46 percent of that value.
The rest, he explained, was lost through management fees, technical service arrangements, and profit repatriation by multinational companies.
He compared Ghana’s situation with other resource-rich countries, stating that South Africa retains a higher share of its gold revenues despite exporting less, while Botswana operates a 50-50 joint venture model in its diamond sector. Nigeria, he added, also enforces stronger local participation requirements.
“Ghana cannot continue to receive less than half of the value generated from its natural resources,” he stressed.
Mr Jackson further pointed to similar trends in the oil and gas sector, where Ghana retained only about 35 percent of export value in 2024, leading to an estimated outflow exceeding US$2.5 billion.
He said these structural leakages continue to outweigh the gains from favourable trade balances, thereby exerting sustained pressure on the cedi.
Mr Jackson emphasised the need to shift policy focus from merely reducing imports to increasing “usable foreign exchange” the share of export earnings that remains in the country to support economic activity.
“If foreign exchange demand exceeds the usable forex available, the cedi will remain under pressure. Increasing exports alone will not solve the problem if we retain less than half of the value generated,” he said.
He called on policymakers to renegotiate resource contracts, strengthen local value chains, and increase Ghanaian equity participation in extractive industries.
Such reforms, he noted, would enhance foreign exchange retention and reduce the country’s exposure to external shocks.
Mr Jackson also urged businesses and the public to recognise that the depreciation of the cedi is rooted in structural challenges rather than consumer behaviour.
He cautioned against blaming importers and consumers for patronising foreign goods, noting that market choices are driven largely by price competitiveness rather than sentiment.
