By stretch of any imagination, the decision by the government of Ghana, through the Bank of Ghana to replace the 1 and 2 cedi notes with coins is not a thought through one, and the idea must be binned forthwith.
The reason for this already unpopular policy makes its implementation worse.
According to the Central Bank, the poor handling of the notes, that is torn and soiled, make it expensive to print them.
Governor of the Bank of Ghana, Dr. Ernest Addison, addressing the press, said the Central Bank will not print any more of the ¢1 and ¢2 notes when those in circulation are phased out.
According to him, the two denominations will be replaced by the ¢1 and ¢2 coins respectively.
“These are 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. We have bales and bales of ¢1 notes that we are not able to process”, Dr. Addison stressed.
Firstly, Dr. Addison may be the governor of the bank, but he does not know about these notes and their circulations more than the citizen who use them daily. These notes are widely used, yes, because of their value and convenience for petty exchanges. However, the 10 and 20 cedi notes are equally widely circulated and used. There are no significant differences in terms of how popular these notes are, and how dirty and soiled they become.
Secondly, the cost of printing the 1s and 2s could not be music higher than 10s and 20s. Their features and size makes it so.
Most importantly, the use of coins to the tune of such high denominations will naturally cause an inflation. Basic and lower transactions will move to the 10 cedi simply because, coins are not business-friendly, and they may become redundant.
There are currently available the 1 and 2 cedi coins, it has been advertised for usage, yet, people dismissed it whenever they are offered. Forcing it on Ghanaians by making it a compulsory note will only make matters worse.
Ghana must reject this decision. Already, there is speculation going on as to the main reason for this is to take away the note that has the head of Ghana's first President.
Whether true or not, the central Bank's own official reason is not an excuse. We need the 1 and 2 cedi around.
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