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Tuesday, April 23, 2024

Ghana’s economy is recovering, and the cedi is now the best-performing currency in Africa

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Last week, the Ghanaian Cedi was cited as the best-performing currency worldwide.

This brief uptick in optimism is due to Ghana’s plan to restructure its domestic debts.

According to a Bloomberg report, the increase in currency value coincides with optimism about the country receiving the $3 billion bailout it has been requesting from the International Monetary Fund for months.

The cedi has increased 10% in the last five days, marking the largest gain among the roughly 150 currencies tracked by Bloomberg. That represents a turnaround for an exchange rate that dropped to the bottom of the charts earlier this year after losing half of its value.

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More from the report: “Cedi was the cheapest in Africa, more than 30% undervalued compared to its 25-year history last week, so some rebound after the huge fall recently isn’t that surprising,” says Charles Robertson, global chief economist at Renaissance Capital Ltd. in London. Furthermore, the IMF is present, which should facilitate dollar support.

The exact opposite of this news—that the Ghanaian Cedi was the world’s worst-performing currency—was previously reported a few months ago.

Outrage and demonstrations followed this news in Accra. The demonstrators also made their way to the Parliament, where several lawmakers began to demand that Ken Offori-Atta, the nation’s finance minister, be fired.

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Drama quickly broke out in the government offices, and fortunately for the finance minister, he was chosen to stay in that position.

This may be a result of some of the initiatives taken by his office, one of which is directly related to the Cedi’s appreciation.

Ghana is one of the most well-known nations in Africa, and its recent record of governance and development is, to put it mildly, impressive. Therefore, it is not unrealistic to believe that this nation can overcome its worst economic crisis in decades.

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