Economist Peter Terkper has attributed the persistent depreciation of the cedi to the country’s high levels of debt denominated in foreign currencies such as the US dollar, Euro and Pound Sterling.
According to him, when the cedi weakens it becomes more expensive for the country to repay these debts.
Mr. Terkper emphasised the need for a deliberate policy by the government and the Central Bank to curb the rising demand for foreign currency which is driving the depreciation of the cedi and impacting the overall economy.
He said, “This is not the first time because we have creditors of our debt in foreign currency. If you borrow from someone in foreign currency, and the person is going to receive that foreign currency and the time. Our debt will always go up if it continues to depreciate. The issue is how do we address the issue of depreciation,”
Mr. Terkper urged the government to focus on building local businesses to reduce dependency on foreign goods.
This, he said, is essential to stabilising the cedi.
