Development Discourse with Amos Safo: Twenty-twenty five in retrospect (2): Economic issues and other matters

Last week, I wrote the first article in 2026, which examined critical issues in 2025 which may have repercussions for the country. In the first article, I analysed the 2024 elections results and the violence that characterized the transition to power.

I shed light on the record-breaking nolle prosequis that the current Attorney General, Dr. Dominic Ayine inflicted on the judicial system, a trend which made mockery of the current government’s promise to fight corruption.

This was followed by the controversial and unconstitutional removal of the Chief Justice, Gertrude Tokornoo from office, which amounted to nothing short of the brazen use of executive power to achieve political ends and to undermine the rule of law.

In this second part, I will analyse relevant economic and financial issues which occurred in 2025 and their socio-political and economic implications for Ghanaians in 2026 and beyond.

Artificial stability

In 2025 the cedi suddenly bounced back from its weakened position against the dollar in 2023 and 2024. As a result, President John Mahaha and his government received commendation for strengthening the cedi against the dollar within a few months of taking power. However, towards the end of 2025 the IMF expressed worry that the stability of the cedi was artificial, and driven by large unsustainable dollar injections into the system by the Bank of Ghana (BoG).

The IMF and other economic analysts argued that injecting more than $10 billion to sustain the cedi could distort the economy and encourage cheap imports. Moreover, the practice could undermine local production and become a springboard for future economic instability and sharp depreciations when interventions cease.

In other words, artificial stability undermines economic transformation as it masks underlying issues. Thus, using dollar injections to stabilize the cedi will undermine the competitiveness of local industries and their capacity to create jobs and boost productivity.

Instead, it is prudent for the BoG to reduce its market interference, promote exchange rate flexibility, and adopt a transparent foreign exchange intervention to reflect supply and demand. It is common knowledge that applying prudent measures in managing the forex market can produce lasting economic growth.

Some economic analysts have buttressed the IMF’s stance that genuine transformation needs structural changes, industrial investment, and policy shifts that build long-term productive capacity. Thus, promoting economic transformation requires a careful balance between exchange rate management and domestic productive capacity.

Counterproductive

Several people are complaining that the cedi’s appreciation is only on paper and has not translated to real economic growth and a reduction in the cost of living. For instance, the simultaneous increase in electricity and water tariffs by 9.86% and 15.92 % respectively has a correlative increase in the cost of production of local goods. This creates strong incentives for increased imports; hence decline in the competitiveness of domestic producers and import dependence.

One analyst argued that any policy framework that expands imports at the expense of local production is counterproductive. Such an approach weakens domestic industrial activity, constrains job creation, and erodes the internal revenue base.

According to him, evidence of these adverse effects of shoring up the cedi manifested in 2025, when the Ghana Revenue Authority failed to meet its revenue targets.  Thus, while forex interventions may enhance short-term macroeconomic stability, they mostly do not drive real sector expansion, inclusive and sustainable growth and employment generation.

Economic transformation

In a write-up titled: ’Why Artificial Stability is not Economic Transformation’, Dr. George Domfe emphasized that Ghana’s economic transformation can only be achieved through structural change, and not excessive exchange rate manipulation.

He therefore urged the government to stop the deliberate manipulation of the forex market and allow market forces to determine the exchange rates. “When such structural conditions are achieved, demand for foreign exchange would decline, thereby allowing the cedi to stabilise through market fundamentals rather than administrative measures”, Dr. Domfe suggested.

Dr. Domfe argued that the Bank of Ghana’s interventionist approach “does not create jobs, does not enhance export performance, and, in fact, risks undermining local production by distorting incentives.” According to him, this approach represents a politically motivated, short-term strategy designed to create the appearance of economic improvement, without addressing the underlying structural weaknesses of the economy.”

Other commentators have suggested that the $10 billion injected into the economy to artificially support the cedi designed to prove to Dr. Bawumia that the NDC is better at managing the exchange rate than the NPP.

If things continue as they are now Dr. Bawumia would be disarmed from using the cedi’s depreciation as a campaign message, should he become the NPP’s flagbearer. One blogger on social media described the ongoing cedi stabilization policy as “power point” economics.

Many Ghanaians are questioning the rational behind pouring $10 billion dollars into the economy to stabilize the cedi, when the scarce foreign exchange could have been used to construct roads, schools and hospitals. While several roads in the urban centers have developed dangerous potholes and need patching, in the rural areas thousands of roads have become unmotorable and have become deathtraps.

There are still thousands of children sitting under trees to receive lessons across the country, while the political elite are busily dissipating scarce foreign exchange on grandiose projects that have no positive impact on ordinary people. The misguided use of money is ongoing, while rural communities still lack portable water and are thus compelled to drink water from stagnant ponds, which bread guinea worms.

GoldBod controversies

Since GoldBod was hurriedly formed in 2025, it has been mired in one controversy after the other.. In fact, the monopoly GoldBod enjoys in the buying and exportation of gold is against the rule of a free market system. It is equally disturbing for Bawa Gold, a private company to have the monopoly of buying all the gold from artisanal gold producers for GoldBod.

In December 2025, the International Monetary Fund (IMF) reported the loss of $214m in gold operations by the GoldBod and the Bank of Ghana. According to the IMF the trading shortfall was a major driver of the Bank of Ghana’s gold for reserve programme. The report flagged the huge losses as a major risk to the country’s stabilization programme.

The IMF affirmed that the losses were driven by trade losses under the artisanal small scale mining transactions. So, what caused the losses in gold trading, given that gold is one of few commodities in the world which has historically enjoyed stable prices over centuries. Could the monopoly that Bawa Gold enjoys in purchasing all gold from small scale producers be cause of the losses? Why is the IMF concerned about GoldBod’s off-taker fees? Could there be some transactions being undertaken on the blind of Ghanaians.

Defending the indefensible

Many economic watchers, including the former minister of finance, Dr. Amin Adam, have expressed concern that a supposed loss of $214 million was neither captured in the books of the Bank, nor was it reported to the IMF by the central bank. Unfortunately, some analysts would want Ghanaians to believe that the US$214 million cited in the IMF report represents a trade loss on the books of the Bank of Ghana, not GoldBod.

In an article published on GoldBod website, Joy FM’s Kojo Yankson, obviously doing damage control for GoldBod cautioned critics against mixing the roles of the two institutions. The apologists of BoG and GoldBod want Ghanaians to believe that the gains that the Bank of Ghana made from the Gold-for-Reserves programme far outstrip the US$214 million loss. If that was the case, why did the IMF raise the red flag over the loss, and why did the IMF warn the government to stop the revenue leakage from gold sales.

Those defending both the GoldBod and the BoG of incurring a loss of $214 million are rather being disingenuous and dishonest. I have listened to commentaries and read articles by some journalists, whose agenda is to throw dust into the eyes of the public as if the monumental loss was anything worth celebrating. Why did the IMF reveal that the domestic gold purchase programme poses a significant risk to BoG?

There must be a reason why both GoldBod and BoG are refusing to allow the $214 million to be captured in their financial records. Perhaps, both Sammy Gyamfi and Dr. Johnson Asiama have a premonition that they could be held accountable one day for causing such colossal financial loss. Irrespective of attempts by some journalists to downplay the loss, it is a financial scandal that is worth investigating in future. And no matter how long it may take, one day Ghanaians might know the truth. See you next week for part three of the series.

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