Ghana could achieve long-term currency stability by partially backing the cedi with gold, cocoa, and other strategic resources, according to Professor Yegandi Imhotep Paul Alagidede, the new Bank of Ghana Chair in Finance and Economics at the University of Ghana.
Speaking at his inaugural lecture at Legon last week, he said Ghana’s position as Africa’s top gold producer and a leading cocoa exporter provides a strong basis for a resource-backed monetary framework.
“A gold-backed digital currency, monitored by the central bank and audited through blockchain technology, could stabilise the Ghanaian cedi while enhancing public trust,” he said.
He added that cocoa futures and forward contracts could boost liquidity in the agricultural sector while supporting broader goals of price stability and monetary independence.
Similar concepts have been applied in Ghana before, such as the gold-for-oil and gold for reserve programmes championed by former Vice President Dr Mahamudu Bawumia, which leveraged the country’s gold reserves to reduce foreign exchange demand for fuel imports and to support the cedi.
At the lecture, both the Governor of the Bank of Ghana, Dr. Johnson Asiamah and head of research of the Bank of Ghana, Dr. Philip Abrado-Otu acknowledged the significant role played by the gold for reserve programme in stabilising the cedi.
Professor Alagidede’s tenure will focus on research in partnership with the Bank of Ghana, developing grant proposals, publishing findings, teaching, and strengthening ties between academia and the financial services sector.
Source: Ernest Arhinful
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