Is The Performance Of The Cedi Against The Dollar Because Of Coronavirus?

Bloomberg, has recently announced that Ghanaian Cedi is the best-performing currency in the world.

In a report published last Monday, Bloomberg described the Cedi, as the “world’s best-performing currency against the dollar this year” adding that the Cedi has “extended its advance on Monday as investors await a Eurobond sale that would bolster the government’s coffers.”

On December 31, Chinese authorities alerted the World Health Organization (WHO to several cases of pneumonia in Wuhan, a port city of 11 million people in the central Hubei province. The virus is unknown.

On January7, this year a novel virus was named 2019-nCoV and was identified as belonging to the coronavirus family.

China imposed a travel restriction on many of their cities, as most countries, have been put on high alert, after the first case was reported outside China.

The current performance of the cedi, which the government is touting as an achievement, can best be described as artificial and so is unsustainable.

Ghana, has largely become a consumption economy. Almost everything we consume in this country is imported. China is now our biggest trading partner.

According to Chai Zhijing, the Economic and Commercial Counsellor at the Chinese Embassy, Ghana last year alone, imported $4.8bn, worth of goods from China.

It, therefore gores the heart and fills the mouth with sullen dirt, when the government wants to take credit for the sudden appreciation of the cedi, when available evidence shows that, the managers of the Ghanaian economy, have nothing to do with it.

The sad question is, can the cedi remain strong, as China and the rest of the world, are working around the clock to find cure for the virus.

It is a good thing that, the cedi has made some appreciable gains, but it is too early to start celebrating, when the factors that led to the current stability are beyond our control.

It is our considered opinion that the government of the day, take advantage of the happenings in China and the rest of the world, to encourage Ghanaians to start patronizing made in Ghana product, because when all is said and done, it will come down to the issue of demand and supply.

 

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