For many years now, some goods sold and services rendered in the country are priced in United States dollars and not the local currency, the Ghana cedi.

These ranges from the payment of school fees, sale of land, particularly in prime areas of the capital region, sale of houses (mortgages) and other immovable properties, hotel accommodation and its other services rendered, sale of vehicles (brand new ones) and in some cases events.

Where one is unable to make payment in the foreign currency, the amount is quoted in the dollar and one is forced to pay at the prevailing exchange rate for the day.

This phenomenon has been condemned by many but governments in the past and present have done very little about this very situation mostly because it is also one of the worst culprits when it comes to this unlawful act.

BoG warning

Following a newspaper publication alerting the central bank of the wanton pricing of goods and services in the country in the US dollar, it issued a public notice on October 10, 2012, under the caption: “PRICING, ADVERTISING AND RECEIPT OR PAYMENT FOR GOODS AND SERVICES IN FOREIGN CURRENCY IN GHANA”.

In a response, it said: “The Bank of Ghana announces for the information of the General Public that it has come to its notice that despite the earlier Notices Nos. BG/GOV/SEC/98/2 dated 14th January, 1998 and BG/GOV/SEC/2001/9 dated 18th June, 2001, which advised against unlicensed or unauthorised dealings in foreign currency, certain institutions (both public and private) and individuals have been pricing, advertising and receiving or paying in foreign currency, especially United States (US) dollars, for their goods and services without the requisite licence or authorisation”.

“The Public is reminded that the Ghana cedi is the only legal tender in Ghana and that the US dollar or any other foreign currency is not the legal tender in Ghana.”

“No resident of Ghana, other than those licensed by the Bank of Ghana to do so, shall price, advertise, receive or make payment in any foreign currency for goods and/or services such as school fees, sale and rental of vehicles, sale and rental of real estate, airline tickets, domestic contracts, etc,” it added.

The notice further warned that: “Those involved in the unlicensed or unauthorised dealings in foreign currency are advised that their actions constitute a violation of the Foreign Exchange Act, 2006 (Act 723) and are therefore cautioned to cease and desist from such practices.”

“The public should note specifically that unlicensed or unauthorised dealings in foreign currency remain illegal and contravene Section 3(1) and (4) of the Foreign Exchange Act, 2006 (Act 723) as stated, that: “A person shall not engage in the business of dealing in foreign exchange without a licence issued under this Act.”

“The business of dealing in foreign exchange includes: -purchase and sale of foreign currency -receipt or payment of foreign currency importation and exportation of foreign currency, and lending and borrowing of foreign currency.”

“Furthermore, Section 29 of Act 723 creates the offence of illegal dealing in foreign exchange and prescribes, on summary conviction, a fine of not more than 700 penalty units or a term of imprisonment of not more than eighteen months or both.”

The notice was a clear indication that the partial adoption of the dollar for the payment of goods and services was unacceptable and should not be allowed.


According to a book titled “Covering Globalisation” and edited by Anya Schffrin and Amer Bisat, ‘Dollarisation is a process by which a country abandons its own currency and adopts the currency of a more stable country as a legal tender.

The book further explained the rationale for that action saying that, in many countries, such as those with weak currencies and underdeveloped banking systems, there is a natural move towards the dollar. Like in Ghana, many prefer to hold their savings in the dollar basically because they do not have confidence in the local currency because of the inflation and the depreciation of the Ghana cedi.

Dollarisation is in two forms, full dollarisation – where a government, mostly in developing countries, deliberately declares the dollar as the official legal tender for the payment of good and services; and unofficial dollarisation or currency substitution – where the value of the local currency becomes volatile and people shift to the dependable dollar for making purchases, valuing assets and personal savings.

Dollar as partial legal tender

In Ghana today, the latter is most prevalent and today, some of the service providers and companies that sell goods openly advertise in the dollar on billboards, television, radio or in the dailies, a clear violation of the law.

It is admissible that due to the volatility of the Ghana cedi, many prefer to seek refuge in the dollar. However, they do so without authorisation as expected by law. The inaction of the central bank has forced many other companies to join the van wagon and this practice is creating a serious challenge for the economy.

Ghana has fast become a country where laws do not work although they can be found in the statute books.

In recent times, the Bank of Ghana has come under a barrage of criticisms because it has woefully failed to discharge its duties as a regulator although officials of that bank are paid heavily with the expectation that they will live up to expectations.

There is a mess with the implementation of the laws governing microfinance institutions and savings and loans companies in the country. There are other companies operating as financial institutions and their activities are simply ripping off unsuspecting members of the public.

The inaction of the central bank nearly caused a mess in the financial services sector until the International Monetary Fund (IMF) mounted pressure on it to live up to expectations, hence the action to close down two banks which were financially distressed beyond the norm.

In countries such as Nigeria and South Africa, nothing is qouted in dollars because they have respect for their currency no matter fast it loses strength against the dollar. Their actions enables their currency to rebound faster whenever it fast depreciates against the dollar at any point in time.

Way forward

As the situation stands, the Bank of Ghana cannot absorb itself from the wanton display of prices of goods and services openly in the country in the US dollar. As mentioned earlier, these are seen in the dailies and on billboards all across the capital and other parts of the country.

If the situation remains the same without any action, very soon, the market women will also start pricing in dollars in their quest to protect the value of their currency.

Countless number of things are being done without any action from the government and these have escalated to an extent that stopping it has become difficult while the laws remain in the statute books.

One can imagine if the already bad situation gets worse as far as this dollarisation of the economy, no matter how small, is concerned.

From the statement issued some five years back, it will be expected that the central bank will be undertaking a post-mortem to see how its directives have been complied with. But people should not be surprised that soon, another notice will be published as a firefighting move but we will sit for another five years to see the situation rather escalate.

BoG must rise to the occasion to justify its existence as a regulator that enforces its own laws and not one that sits to react when prompted. It is clear from the macroeconomic indiscators that the economy is on the right track and the currency has stablised over a long period. As a result, work must be done by the regulator to restore confidence in the Ghana cedi by preventing the use of the dollar as legal tender alongside the local currency.


  1. What is the government talking about? Are they not the first to quote import duties in dollar equivalents? All customs duty are priced and quoted in the US dollars before changing into Ghana Cedis. If they want to stop other institutions it should start from the Customs. This country is really under curse.

    • Ghanaians go to other countries and abide by their laws, but in their own country they can’t even follow the law. That is because there are no consequences.

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