Sammy Gyamfi attributes the worsening depreciation of the Cedi to a “dollar shortage and irresponsible borrowing
Sammy Gyamfi, the National Communications Officer for the opposition National Democratic Congress (NDC), has criticized the current government’s handling of the Ghanaian economy, specifically blaming the continuous depreciation of the cedi on a combination of factors, including a shortage of US dollars and what he describes as “reckless borrowing.” The cedi, Ghana’s national currency, has been losing value steadily against the dollar in recent years, with recent rates placing it at around GH¢17.00 to the US dollar. Gyamfi attributes much of this decline to the country’s inability to access sufficient US dollars, a situation he believes is exacerbated by poor fiscal management and unsustainable borrowing by the government.
In his statement, Gyamfi stated that the primary reason for the persistent depreciation of the cedi is the acute shortage of dollars in Ghana’s economy. He claims that this shortage is a direct result of the government’s financial mismanagement, particularly the aggressive borrowing strategy undertaken since the New Patriotic Party (NPP) assumed office in 2017. “One of the major factors for the constant depreciation of the Ghana cedi is the shortage of dollars in Ghana,” Gyamfi said, stressing that the government’s debt accumulation practices have contributed to the economic challenges the country is currently facing.
Gyamfi further placed blame on the NPP administration’s handling of the national debt, accusing it of engaging in what he described as a “reckless borrowing spree.” According to him, the government, under the leadership of Vice President Dr. Mahamudu Bawumia and the economic management team, has accumulated unsustainable debt that has led to a significant financial crisis. “What has caused this? Number one, our bankruptcy,” Gyamfi declared, referring to the state of Ghana’s economy, which has reached a point where it is unable to meet its debt obligations. He pointed to the government’s borrowing practices as the root cause of this financial distress.
The NDC spokesperson did not hold back in his criticism of the government’s borrowing strategy, claiming that despite advice from both the NDC and other independent financial experts, the government continued to take on loans without a clear plan for repayment. “They borrowed recklessly, despite sound counsel from the NDC and other neutral sources,” he stated. Gyamfi’s remarks also highlighted the fact that these loans were not used for productive or revenue-generating projects. Instead, he argued, the funds were spent on consumption and wasteful activities. “The worst part is that the borrowed funds were not invested in the productive sectors of the economy. They were not invested in revenue-generating projects and programmes that could pay for these loans,” he said, further criticizing the government’s failure to create the necessary infrastructure and investments to pay back its debts.
The result of this financial mismanagement, according to Gyamfi, is that Ghana has reached a point where it is now considered a bankrupt nation. He pointed out that in November 2022, for the first time in Ghana’s history, the country was unable to meet its debt obligations, marking a significant economic milestone. “For the first time in the history of Ghana, we became a bankrupt nation,” he noted, emphasizing the severity of the situation.
In addition to the country’s debt problems, Gyamfi highlighted that Ghana’s exclusion from the international capital markets has worsened its financial plight. He explained that due to the government’s reckless borrowing and the subsequent mismanagement of those funds, Ghana was effectively locked out of borrowing from international investors. “Because of bad leadership that borrowed recklessly and squandered those borrowed funds on consumption and corruption, Ghana was excluded from the capital markets,” he said. This exclusion has made it even more difficult for the country to access external financing, which is necessary for development projects and to stabilize the national economy.
Another key point raised by Gyamfi was the erosion of investor confidence in the country’s economy. He expressed concern that the government’s financial mismanagement has led to a loss of trust among potential investors. “The current state of the nation has destroyed investor confidence in our economy,” he said. In his view, the only way to reverse this trend and restore economic stability is to rebuild investor confidence. He argued that this can only be achieved through the implementation of sound fiscal and monetary policies, which he believes will be championed by the NDC and its presidential candidate, John Mahama.
In addition to the current debt crisis, Gyamfi pointed to the latest figures from the Ministry of Finance, which show that Ghana’s central government debt had ballooned to GH¢742.0 billion as of June 2024, representing 70.6% of the country’s Gross Domestic Product (GDP). This amount reflects a 22% increase from the end of 2023, partly due to the depreciation of the cedi and the ongoing debt servicing obligations. The total debt is split between GH¢452.0 billion in external debt and GH¢290.0 billion in domestic debt, highlighting the country’s reliance on both foreign and local borrowing to finance its operations.
Gyamfi’s remarks reflect the opposition’s strong criticism of the government’s economic policies, particularly its approach to borrowing and managing national finances. He argues that the government’s reckless fiscal management has led to the current economic crisis, with significant implications for the cedi’s value, investor confidence, and the country’s financial future. Gyamfi called for a change in leadership, with a focus on restoring economic stability through prudent management of public resources.
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