Editorial: A welcome discipline in FX markets

The Bank of Ghana’s (BoG’s) decision to halt unbacked dollar cash withdrawals by large corporations should be seen not as bureaucratic meddling but as a necessary step in the long struggle to protect national resources.

For too long, practices that drained foreign exchange without clear justification were tolerated. The result has predictably been mounting pressure on reserves, a fragile cedi, and a sense that the system rewarded those with the greatest access rather than those with the greatest need.

This intervention comes at a time when the State has begun to claw back economic stability. The cedi, which depreciated by around 17 percent in 2024, has gained more than 40 percent against the US dollar this year, supported by tighter fiscal management and improved inflows.

Gross international reserves, which fell to just over US$8.9 billion at the end of 2024, have recovered to US$11.1 billion by mid-2025, providing import cover of roughly 4.8 months. These gains, however, remain fragile.

Policymakers have lived this cycle before where a surge in inflows, a burst of optimism, precedes the quiet bleeding away of reserves through undisciplined outflows. It is that cycle the central bank is now determined to break.

The argument that oil importers and mining firms, crucial to the economy, require flexibility cannot be dismissed. These sectors drive foreign exchange earnings, tax revenues, and jobs. But discipline and equity must take precedence. Ordinary citizens have endured years of inflation, austerity, and painful fiscal adjustments.

Consumer prices rose by more than 50 percent at the peak of the 2022 crisis and the cumulative effect means that prices remain high despite the metric falling to 12.1 percent in July.

It would be untenable if the corporate sector were permitted to siphon off dollars in ways that undermine the collective recovery. What is at stake is not merely macroeconomic stability but also public confidence that policy serves the common good rather than entrenched privilege.

However, the central bank’s stance will not by itself resolve Ghana’s deep structural imbalances. The country remains heavily dependent on commodity exports and external financing. But by plugging one of the leaks in its foreign exchange regime, it has sent a clear message that stability is a shared responsibility.

The task ahead is to ensure that the benefits of tighter discipline are not confined to the balance sheets of large firms or to macroeconomic indicators, but felt in the lives of ordinary Ghanaians who still carry the burden of past crisis.

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