Development economist at the University of Ghana, George Domfe, has cautioned that Ghana’s current economic stability is largely artificial and risks collapsing without structural reforms.
Speaking on the Asaase Breakfast Show on Wednesday (7 January), Domfe said the appreciation of the cedi and declining inflation are being driven primarily by aggressive Bank of Ghana intervention and favourable global conditions rather than strong domestic fundamentals.
“Supplying over one billion dollars a month to support the cedi is not sustainable,” he warned.
Domfe explained that debt restructuring and the suspension of external debt payments — rather than new government policies — have created fiscal space and foreign exchange stability.
He noted that while inflation has dropped to 6.3 percent, economic growth has slowed, raising concerns about job creation and long-term resilience.
“We are sacrificing growth and employment for short-term stability,” he said.
Domfe also cautioned against celebrating early gains, warning that an over-appreciated currency could hurt exports, reduce government revenue, and undermine industrial growth.
He urged the government to focus on strengthening Ghana’s productive base, particularly manufacturing, to reduce import dependence and create sustainable jobs.
“The cedi should be strong because we are producing more — not because the central bank is propping it up,” he said.
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