Speculative Dollar Hoarding Driving Artificial Cedi Gains – Henry Kokofu Warns of Export Threat
Former Executive Director of the Environmental Protection Agency (EPA) and New Patriotic Party (NPP) National Secretary hopeful, Henry Kwabena Kokofu, has cautioned that the recent appreciation of the Ghanaian cedi against the U.S. dollar is largely artificial and poses a threat to Ghana’s export competitiveness if not properly managed.
Speaking in an interview on Adom TV, Kokofu attributed the strengthening of the cedi not to structural economic improvements, but to speculative practices and a decline in global demand for the U.S. dollar.
“The rise of the dollar is artificial,” Kokofu said. “Top businessmen in Ghana are engaging in speculative buying. Some wake up as early as 5am to buy and hoard dollars, creating artificial demand.”
He further explained that changes in the global economic landscape, including reduced reliance on the U.S. dollar by emerging economic blocs like the BRICS (Brazil, Russia, India, China, and South Africa), are also contributing to the weakening of the dollar globally.
“Brazil doesn’t need it, China doesn’t need it, South Africa and the BRICS block don’t value the dollar like before,” he noted. “That is why the dollar is coming down or depreciating against the cedi.”
Kokofu warned that while the Cedi’s current rise may seem like good news, it could harm Ghana’s exporters and local industries in the long term if not addressed with the right policy framework.
“As your cedi is rising, you are killing export drive,” he cautioned. “If we don’t take care and balance it, and we are glorifying in the fact that the dollar is depreciating, we will end up with low or no exports.”
He emphasized the need for strong export-oriented policies to ensure sustainable economic growth.
Without such policies, he warned, the relative strength of the cedi could encourage a surge in imports, leading to a flood of foreign goods that would undermine local producers.
“If importation goes up because the dollar is cheap, people will buy it to import goods and flood the country, killing local industries,” he said.
Kokofu’s comments come amid growing debate over the true drivers of the cedi’s performance and the broader implications for Ghana’s economy as policymakers work to balance currency stability with export competitiveness.
