It wasn’t too long ago that Ghana’s 1 and 2 cedi notes were prominent features in our daily transactions. From buying waakye, paying for kenkey, paying for a quick ride, or handing out tips to show our generosity.
These, then valuable notes, have been reduced to coins and are on their way to going extinct or disappearing from the system.
Economist, Dr. John Kwakye does not mince words with the development. He says the ongoing disappearance of these lower denominations is the doing of the Bank of Ghana. The Director of Research at the Institute of Economic Affairs (IEA) explains that the failure of the Central Bank to tackle inflation and stabilize the cedi is the cause of the gradual disappearance of the notes from the system.
Dr. Kwakye says the 5 cedi note is also at risk as inflation continues to bite harder and harder.
To the low-income earners, the absence of the lower denominations signals a deeper problem. The disappearance of lower denominations means the erosion of their purchasing power. This means what was sold at 1 or 2 cedis, may now sell higher due to the absence of these denominations. With the 5 cedis also at risk, the ordinary Ghanaian is in for a deeper cost of living challenges.
“The Bank of Ghana has overseen the disappearance of our 1 and 2 cedi notes due to hyperinflation and depreciation. Now the pressure is on the 5 cedi note. An example of how not to govern a central bank,” a very disturbed Dr. Kwakye expressed his frustration in an X post cited by The High Street Journal.
For Dr. Kwakye, the disappearance of these notes is a symptom of a larger economic governance failure. Inflation has surged in recent years, hitting ordinary Ghanaians the hardest. The Bank of Ghana’s monetary policies, aimed at stabilizing the currency, have seemingly done little to prevent its freefall.
As the 5 Cedi notes fate hangs in a balance, it is the fervent hope of every Ghanaian that the Bank of Ghana as well as the government sit up and implement transformative measures to arrest the ever-rising inflation and stabilize the Cedi.
