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Phasing Out Gh¢1 and Gh¢2 Notes Is An Attack On Ghana's Economy - OPINION

The Central Bank of Ghana on Monday 27th September has announced the gradual phasing out of the 1 and 2 cedi notes. The idea behind phasing out the 1 and 2 cedi notes made in a statement by the governor of BOG is not convincing enough. It doesn't clearly define neither does it reflects the purpose unless BoG has a different agenda against such denominations. The plan is irrational and I see this attempt as exceedingly absurd. This must be an infantile tale and not a reality in the pipeline.

According to Dr Ernest Addison, “Both the GHC1 note and the GHC2 note would eventually be phased out because they are not cost-effective in terms of the printing cost.

“Notes that circulate very widely and they come back very torn and soiled and they are very difficult for our currency processing machines to process them.”

He further added that “We have bales and bales of GHC1 notes that we are not able to process. So the view for the longer term is to more or less get out of the GHC1 and GHC2 notes and use the GHC1 and GHC2 coins.”

Dr Addison also stated that “You will recall that this is a note [GHC2] that was issued as a commemorative note. So commemorative notes are not notes that you continue to print and therefore what we have done in the last two years, is to introduce the GHC2 coin and you would expect that eventually, it would more or less play the role that the GHC2 note is playing.”

If the above statement made by the governor is true then the 1 and 2 cedi coins are equally not cost-effective for the following reasons;

The currency coins are more disposed to lose. A lot of people in the business space and trade in general, cannot account for these coins they receive in everyday transactions.

Some coins are grinded in corn Mills causing deformity to the coins and some are mistakingly drowned in water bodies.

It is very difficult to carry about Gh¢50 of coins along. Carrying these coins worth just 50 cedis in a purse or pocket will make it too heavy and also possible to tear the purse or the pocket hence making handling and circulation very stressful.

Ghanaians do not regard coins so BOG action is likely to depreciate the cedi. What happened to the 1 and 5 pesewas and made toffees and other goods worth 1 and 5 pesewas to accrue to 10,20 and 50 pesewas respectively likely to happen again. The already 1 and 2 cedi coins are not regarded in trade, in our markets and business centres and the 1 and 5 pesewas is a good case study of the narrative.

If 1 and 2 cedi notes are circulated and returned soiled and torn, it by prudent for BoG to change the materials used to produce our cedi notes by initiating high-quality materials than inferior paper to make them difficult to be torn. BoG should do this and save the country especially the vulnerable masses from inflation attacks and the high cost of living.


Content created and supplied by: Juniorholy96 (via Opera News )

Addison Central Bank of Ghana Ernest Addison GHC2


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