Ghana urgently needs to diversify its economy to ensure long-term stability for the Cedi, according to economist Patrick Asuming.
Asuming, a lecturer at the University of Ghana, stated that Ghana cannot rely solely on short-term improvements in the Cedi's value. He warned that the nation remains vulnerable due to its heavy dependence on gold exports.
Recent Cedi stability stems from fiscal and monetary interventions. However, the economy's reliance on a few primary commodities makes it susceptible to global market fluctuations. Ghana's external trade reached GHS 145 billion in Q3 2025, but this trade is still heavily skewed towards raw exports.
“If we begin to see so much pressure on the currency that, within a short period, we experience massive losses, then you begin to worry because that is when things get out of control,” Professor Asuming explained. He noted that short-term currency movements often reflect financial flows and policy interventions. “Those have been somewhat stabilised,” he added, referring to the immediate measures taken by authorities.
Professor Asuming stressed that the Cedi's long-term strength depends on Ghana's balance of payments. This includes the volume of exports versus imports and the diversity of the export base. He argued Ghana has not built an economy resilient enough to withstand external shocks. While rising gold prices have recently boosted the Cedi, this reliance is dangerous.
Ghana does not control global gold prices, which are highly volatile. “Our exports have risen sharply – the highest we’ve seen in a long time,” he acknowledged. “But what you have to understand is that it is still heavily reliant on the price of gold, which we do not control and which is extremely volatile.” This volatility means current benefits could quickly disappear if prices fall, exposing the inherent vulnerabilities.
Professor Asuming called for immediate action to diversify the economy. He emphasized reducing dependence on raw commodity exports. He identified value addition as a critical solution to Ghana’s economic vulnerability. Countries that process raw materials into finished goods typically enjoy more stable prices. “Statistically and historically, the prices of higher value-added products are more stable than those of primary commodities,” he noted.
For example, processing raw gold into jewellery could increase foreign exchange earnings. This also creates more local jobs and diversified income sources. This strategy should extend to all raw materials, including cocoa. Building a diversified and robust economy offers the surest protection against future currency instability. Value addition strengthens the economy, creates employment, and improves resilience against global shocks. “The person who takes raw gold and adds value earns more, and the prices of those products are less susceptible to swings in the global economy,” Professor Asuming concluded. This will also create more jobs locally, making the economy more robust.