Political sketch
Formerly the Gold Coast and part of British West Africa. Independent from the United Kingdom on 6 March 1957.
The Portuguese landed on the Gold Coast (so called for its gold mines) in the early 1400s, and established a settlement to deal in the slave trade. By the 1600s the Portuguese were no longer the dominant slave traders, and by the mid 1700s the coast had Dutch, British, and Danish forts. The United Kingdom made the Gold Coast a colony in 1874, and British protectorates over the Ashanti confederation of tribes and the northern territories were established in 1901. British domination was achieved by four wars against the powerful Ashanti confederation during the 1800s. Under colonial rule, cocoa became the major export; today, timber is also a significant export.
On 6 March 1957 the Gold Coast became independent as Ghana; it was the first former colony in sub-Saharan Africa to become independent under majority rule. (South Africa had become independent in 1910, but was ruled by its white minority.) Its first prime minister (from 1960 president) was Kwame Nkrumah. Nkrumah's socialist economic policies were disastrous, and he was ousted in a military coup on 24 February 1966. There were other coups in 1972, 1978, 1979, and 1981. The 1981 coup was led by Jerry Rawlings, who was elected president in 1992. A civil war between two ethnic groups in the north erupted in 1994-1995; the central government ended it with a mixture of force and intermediation. Multiparty elections were held in 1996. In January 2001, Ghana had its first experience of an elected president succeeding another elected president.
Wars since 1500
Dutch-Portuguese Wars in West Africa, about 1620-1655; First Ashanti War (Ashanti against United Kingdom), 1824-1831; Second Ashanti War, 1873-1874; Third Ashanti War, 1893-1894; Fourth Ashanti War, 1895-1896; Ghanian Civil War of 1994-1995.
Convertibility
The sterling area:
On 2 August 1914, soon after the First World War began, the United Kingdom issued a proclamation imposing a one-month moratorium of payment for bills of exchange accepted before 4 August; an act of 3 August 1914 gave legislative sanction to the proclamation. The moratorium was subsequently extended for a month and ended on 4 November 1914. Legally the pound sterling remained convertible into gold and could be exported, but the risk to shipping from German submarines made the cost of shipment prohibitive, so the United Kingdom was in effect off the gold standard. The British government refused to include private shipments of gold in its war-risk insurance scheme. After the war, the export of gold was prohibited from 1 April 1919 under regulations that were given statutory form in 1920. On 28 April 1925 the government announced that the act would not be renewed when it expired on 31 December 1925. On 13 May 1925 the United Kingdom resumed the gold standard.
The United Kingdom abandoned the gold standard on 21 September 1931. The currencies of British colonies were almost all linked to the pound sterling through currency boards; being on a sterling-exchange standard rather than a gold-exchange standard, they followed the pound sterling off gold. Over the next few years, some former British colonies (Australia, New Zealand, South Africa) and other countries that had important trade links with the United Kingdom switched from gold to the pound sterling as their official or actual anchor. The result was termed the sterling area. The United Kingdom imposed exchange controls on 4 September 1939, the day after entering the Second World War. Most countries that were not current or former British colonies soon left the sterling area. Among the remaining countries, both current- and capital-account transactions were free of restrictions within the sterling area, but were restricted in dealings with outside countries. After the Second World War, the United Kingdom returned to the gold standard under the Bretton Woods system. It removed exchange controls on 15 August 1947, but reimposed them on 20 August 1947 after suffering a large loss of foreign reserves. Sterling had a dual exchange rate from 1961 until the United Kingdom abolished exchange controls. The sterling area remained in existence because sterling was not fully convertible. It began to crumble after the United Kingdom again abandoned the gold standard on 23 June 1972. By January 1973 the sterling area had shrunk to the British Isles and a few small British colonies; even Hong Kong had abandoned sterling as its anchor currency. The United Kingdom abolished exchange controls on 24 October 1979, ending the sterling area.
The West African Currency Board:
In late 1915, the Gold Coast (now Ghana), Nigeria, and Sierra Leone passed ordinances making British notes legal tender. The West African Currency Board circulated the notes; at the time, it was not allowed to issue notes. Circulation of British notes was a temporary measure intended to reduce a shortage of currency during the First World War, when German submarine warfare made it risky to transport coins by ship from the United Kingdom, where they were minted.
Ghana alone:
Ghana imposed wide-ranging exchange controls in 1961 (Ghana, Exchange Control Act, 1 August 1961). It left the sterling area on 23 June 1972.
Other
Defaults on or restructurings of debt to the private sector (mainly from Purcell and Kaufman 1993 and Standard & Poor's 2004): 1969, 1979 (local currency debt), 1982 (local currency debt), 1987 (foreign currency bank debt).
Reinhart and Tokatlidis (2000: 33) dating of recent financial liberalization: Domestic (notably interest rates) 1988, external (notably foreign-exchange market and participation by foreign financial institutions) 1994.
Banking crises (data since 1970s mainly from Caprio and Klingebiel 1999 and Frydl 1999): Seven of 11 banks in the country were insolvent 1982-1989; moderate problems or even a borderline crisis starting 1997.
Frankel and Rose (1996) list of currency crashes: 1983.
References
Primary sources:
--Laws and decrees:
Ghana. Gazette. 1957-present. Ghana Gazette. Accra: Ghana Publishing Corporation. (Successor to Ghana gazette.)
Gold Coast. Gazette. 1885-1957. Government Gazette (1885-1922); Gold Coast Gazette (1922-1957). Accra: Government Printing Department. (Succeeded by Ghana gazette.)
Great Britain (United Kingdom). Gazette. 1665-present. Oxford Gazette (1996-1666); London Gazette (1666-present). Oxford (1665-1666); London (1666-present): His/Her Majesty's Stationery Office from 1903. Online at <http://www.gazettes.online.co.uk>; as of September 2005, gazettes since 1900 are available.
--Publications of monetary authorities:
Bank of Ghana. Annual report.
Bank of Ghana. Bulletin. 1962-1978, 1994-present. Quarterly Economic Bulletin. Accra: Bank of Ghana. (I have seen no issues from late 1978-1990, when publication may have ceased; a new series of the bulletin began to be published in 1991.)
Great Britain (United Kingdom). West African Currency Board. Annual report. 1913/1914-1972/1973. Report of the West African Currency Board for the Period Ended 30th June 1914 (1913/1914); Report of the West African Currency Board for the Year Ended 30th June ... (1914/1915-1971/1972); Final Report of the West African Currency Board for the Period 1st July, 1972 to 31st October, 1973 (1972/1973). London: Darling and Sons for His Majesty's Stationery Office (1913/1914-1917/1918); His Majesty's Stationery Office (1918/1919-1919-1920); Waterlow and Sons (1920/1921-1972/1973).
West African Currency Board. See Great Britain (United Kingdom). West African Currency Board.
--Web site of the current monetary authority (viewed 20 September 2005):
<http://www.bog.gov.gh>
--Other publications or Web sites:
Loynes, J[ohn] B[arraclough de]. 1961. Report on the Problems of the Future Currencies of Sierra Leone and the Gambia. Gambia Sessional Paper No. 12/61. Bathurst: Government Printer.
Main secondary sources:
Adjetey, S. M. A. 1978. The Structure of the Financial System in Ghana. Accra: Research Department, Bank of Ghana, September.
Anin, T. E. 2000. Banking in Ghana. Accra: Woeli Publishing Services.
Chalmers, [Sir] Robert. 1893. A History of Currency in the British Colonies. London: Eyre and Spottiswoode for Her Majesty's Stationery Office.
Crossley, [Sir] Julian [Stanley], and John Blandford. 1975. The DCO Story: A History of Banking in Many Countries 1925-71. London: Barclays Bank International. (Concerns Barclays Bank Dominion, Colonial and Overseas.)
Fry, Richard. 1976. Bankers in West Africa: The Story of the Bank of British West Africa Limited. London: Hutchison.
IMF ARER. 1950-present. International Monetary Fund. Annual Report on Exchange Restrictions (1950-1978), Annual Report on Exchange Arrangements and Exchange Restrictions (1979-1988), Exchange Arrangements and Exchange Restrictions: Annual Report (1989-present). Washington: International Monetary Fund. (Contains information on IMF member countries and some of their dependencies.)
Loynes, J[ohn] B[arraclough de]. 1962. The West African Currency Board 1912-1962. London: West African Currency Board.
Orleans-Lindsay, J. K. 1967. Bank of Ghana 1957-1967. Accra: Bank of Ghana.
Monetary authorities: Ghana
| Dates | Type | Name | Source | Remarks |
| 1896
-25 June 1913 |
dollarization | pound sterling (issued by central bank Bank of England [headquarters London, England]) | United Kingdom, incorporation papers of Bank of British West Africa, 31 March 1894 cited in Richard Fry (1976: 26) | The first bank was the Bank of British West Africa (headquarters Liverpool, later London, England), in Accra, in 1896 (Richard Fry 1976: 27). The second bank was the Colonial Bank (headquarters London, England), in Accra, on 14 February 1917 (Crossley and Blandford 1975: 315). Ghana issued its first coins in 1912 (West African Currency Board annual report, 30 June 1915: 4). |
| 26 June 1913
-30 July 1957 |
joint currency board (as part of a currency union) | West African Currency Board (headquarters London, England) | United Kingdom, Secretary of State for the Colonies, Memorandum Defining the Constitution, Duties and Powers of the West African Currency Board, 6 December 1912, reprinted in West African Currency Board annual report, 30 June 1914: 7; Order in Council of 7 May 1913, cited in West African Currency Board annual report, 30 June 1914: 4; Secretary of State for the Colonies, Memorandum Defining the Constitution, Duties and Powers of the West African Currency Board, 2 September 1949, reprinted in West African Currency Board annual report, 30 June 1949: 15 | The United Kingdom established the West African Currency Board to capture seigniorage for the colonial governments of Gambia, the Gold Coast (now Ghana), Nigeria, and Sierra Leone. Local proclamations of 26 June 1913 (cited in cited in West African Currency Board annual report, 30 June 1914: 4) allowed the British Order in Council of 7 May 1913 to enter into force. The board's original constitution only allowed it to issue coins, which were more widely used by Africans than notes. A revision of 25 November 1915 (reprinted in West African Currency Board annual report, 30 June 1916: 6-7) allowed it to issue notes. About October 1915 the currency board issued British notes as a temporary measure to meet the demand for currency in the Gold Coast (now Ghana), Nigeria, and Sierra Leone, but not Gambia. The colonies where the board issued British notes passed local ordinances making the notes legal tender (West African Currency Board annual report, 30 June 1916: 2). The board first started investing in local securities in January 1957 (Loynes 1961: 20; West |
| 1 August 1957
-13 July 1958 |
central bank alongside currency board | Bank of Ghana (headquarters Accra, Ghana) alongside West African Currency Board (headquarters London, England) | Gold Coast, Bank of Ghana Ordinance, No. 34, 4 March 1957, reprinted in Orleans-Lindsay (1967: 45-68) | Ghana established a central bank soon after achieving independence. The central bank's corporate ancestor for banking operations was the government-owned Bank of the Gold Coast (headquarters Accra, Ghana), which had begun in 1953. The Banking Department of the central bank began operations at the start of this period, but the central bank did not issue notes and coins. |
| 14 July 1958
-present (2005) |
central bank | Bank of Ghana (headquarters Accra, Ghana) | Gold Coast, Bank of Ghana Ordinance, No. 34, 4 March 1957, reprinted in Orleans-Lindsay (1967: 45-68) | The central bank began issuing notes and coins to replace those of the West African Currency Board (Bank of Ghana annual report 1957/1958: no page). Government-owned banks dominated Ghana's banking system from 1960. |
Exchange rate arrangements: Ghana
| Dates | Official arrangement | Source | Unofficial arrangement, if different | Remarks |
| 1667
-1822 |
fixed? (see Remarks) | general histories | Details of the period before 1821 are vague, according to Chalmers (1893: 212). From 1821-1874, Ghana, Nigeria, and Sierra Leone were combined into the West African Settlements, and legislation in force in Sierra Leone prevailed. | |
| 1822
-1825 |
fixed; Spanish silver $4 = UK£1, or Spanish silver $1 = UK 5 shillings (60 pence) | Sierra Leone, decision of local Council, 1822, cited in Fyfe (1962: 142) | Sierra Leone established a legal rating for the pound sterling. Recall that in British monetary system of the time, £1 = 12 shillings (s.) and 1 shilling = 12 pence (d.), so £1 = 240d. | |
| 1825
-29 September? 1843 |
fixed, bimetallic | United Kingdom, Order in Council, 23 March 1825; Chalmers (1893: 209) | In practice, Spanish silver $1 = UK 4 shillings 4 pence (52 pence), the rate established by the Order in Council of 1825. | British currency became legal tender along with the Spanish dollar. Spanish and other silver dollars and gold doubloons were the most common larger coins of this period; "cut dollars," dollars divided into four, were widely used as quarter-dollars. |
| 30 September? 1843
-10 May 1880 |
fixed, bimetallic | United Kingdom, two Orders in Council, 10 June 1843; Sierra Leone, proclamation, 30 September? 1843; these laws were reiterated by Gold Coast, governor's proclamation of 5 August 1875, cited in Chalmers (1893: 212) | In practice, Spanish silver $4.80 = UK£1, or Spanish silver $1 = UK 4 shillings 2 pence (50 pence), the rate established by one of the Orders in Council of 10 June 1843. | The starting date is a guess based on the date of a local proclamation in the sister colony of Gambia (cited in Chalmers 1893: 220n.). British and certain French, and Spanish coins were legal tender in British possessions in West Africa. Dutch silver coins were legally accepted in payment to the government in 1872 (Gold Coast, governor's order of 1872). In 1852 US gold coins were made legal tender in British possessions in West Africa (United Kingdom, Order in Council and Proclamation, 20 June 1852). They were never widely used. Belgian, Italian, and Swiss 5-franc pieces were later made legal tender alongside French pieces (United Kingdom, Order in Council and Proclamation, 27 November 1874, published locally in Sierra Leone 5 January 1875). In Ghana, gold nuggets and dust were widely used as currency, trading by weight, on account of presence of local gold mines. |
| 11 May 1880
-25 June 1913 |
fixed; used pound sterling | Gold Coast, Demonetization Ordinance, No. 2, 29 April 1880, cited in Chalmers (1893: 214) | The ordinance limited legal tender coins to British coins plus several foreign gold and silver coins widely used in trade and gold dust or nuggets. Gold dust and nuggets were demonetized by Gold Coast, Ordinance No. 9, 12 April 1889, cited in Chalmers (1893: 215). The predominant coins in use were British silver coins and, along the coast, British gold coins. | |
| 26 June 1913
-13 July 1958 |
fixed (as part of a currency union); West African £1 = UK£1 | United Kingdom, Secretary of State for the Colonies, Memorandum Defining the Constitution, Duties and Powers of the West African Currency Board, 6 December 1912, reprinted in West African Currency Board annual report, 30 June 1914: 7; Order in Council of 7 May 1913, cited in West African Currency Board annual report, 30 June 1914: 4; Secretary of State for the Colonies, Revised Regulation Defining the Constitution, Duties and Powers of the West African Currency Board, 11 July 1924, reprinted in West African Currency Board annual report, 30 June 1924: 5 | The British government gave its West African colonies their own currency. Local proclamations of 26 June 1913 (cited in cited in West African Currency Board annual report, 30 June 1914: 4) allowed the British Order in Council of 7 May 1913 to enter into force. The appreciation of silver up to 1920 caused hoarding and shortages of West African silver coins, even though they were not full-bodied. Technically, West African Currency Board coins were initially redeemable in gold, though in practice, the pound sterling was always the anchor. The constitution of the currency board was amended in 1924, when Britain was off the gold standard, to allow notes and coins to be directly redeemable in pounds sterling. The West African pound was named after the pound sterling. | |
| 14 July 1958
-18 July 1965 |
pegged; Ghana £1 = 2.48828g gold = UK£1 | Gold Coast, Bank of Ghana Ordinance, No. 34, 4 March 1957, reprinted in Orleans-Lindsay (1967: 45-68); Bank of Ghana annual report, 30 June 1959: no page | RR: Parallel market premium typically in mid double digits from March 1962, when data start, rising to nearly 200% by June 1965. | Ghana introduced a national currency. It was issued by a central bank, so the exchange rate changed from fixed to pegged. Ghana registered a gold parity with the IMF on 5 November 1958. |
| 19 July 1965
-22 February 1967 |
pegged; 2.40 Ghana cedis = UK£1, or 1 cedi = 1.03678g gold = US$1.16-2/3 | Bank of Ghana Amendment Act, No. 282, 9 April 1965, reprinted in cited in Orleans-Lindsay (1967: 99-100); Bank of Ghana annual report, 30 June 1966: 7 | RR: Parallel market premium approaching 200% at one point. | The decimalized cedi replaced the pound at 2.40 Ghana cedis = Ghana £1. The exchange rate was chosen so that 1 old penny (1/240th of a pound) = 1 new pesewa (1/100th of a cedi). Cedi may have come from the local Akan language, meaning "cowry" (which was long used by local people as money). |
| 23 February 1967
-23 July 1967 |
pegged; 2 Ghana new cedis = UK£1, or 1 new cedi = 1.24414g gold = US$1.40 | Bank of Ghana annual report, 30 June 1967: 2-3 | RR: Parallel market premium often 180%. | A new cedi replaced the old cedi at 1 new Ghana cedi = 1.20 old Ghana cedis. The new cedi introduced to make conversion from Ghanian pounds easier and to provide an opportunity for removing the picture of deposed ruler Kwame Nkrumah from the currency. The old cedi ceased to be legal tender on 23 May 1967. |
| 8 July 1967
-17 November 1967 |
pegged; 2.45 Ghana new cedis = UK£1, or 1 Ghana new cedi = 0.870897g gold = US$0.98 | Ghana, decision of National Liberation Council, 8 July 1967, reprinted in Bank of Ghana annual report, 30 June 1968: 41-2 | RR: Parallel market premium in mid to high double digits. | Devalued the new cedi. |
| 18 November 1967
-14 August 1971 |
pegged; 1 Ghana new cedi = UK£0.408333 = 0.870897g gold = US$0.98 | Bank of Ghana annual report, 30 June 1967: 5 | RR: Parallel market premium in high double digits but falling to mid double digits toward end of period. | Did not follow the devaluation of the pound sterling on 18 November 1967. |
| 15 August 1971
-3 November 1971 |
pegged; 1 Ghana new cedi = UK£0.408333 = 0.870897g gold (nominally) | IMF ARER (1972: 181) | RR: Parallel market premium in mid double digits. | Gold convertibility for all countries ended in practice when the United States abandoned the gold standard on 15 August 1971. Ghana maintaned its peg to the pound sterling, in effect unpegging from the US dollar. |
| 4 November 1971
-26 December 1971 |
pegged; 1 Ghana new cedi = US$0.98 = 0.870897g gold (nominally) | IMF ARER (1972: 181) | RR: Parallel market premium in mid double digits. | Ghana switched from the pound sterling to the US dollar as its anchor currency. Ghana did not follow the devaluation of the US dollar against gold on 18 December 1971, but neither did it revalue against the US dollar. |
| 27 December 1971
-6 February 1972 |
pegged; 1 Ghana new cedi = US$0.55 = 0.450182g gold (nominally) | Bank of Ghana annual report, 30 June 1972: 33; IMF ARER (1972: 181) | RR: Parallel market premium in mid double digits. | Devalued and modestly liberalized exchange controls. |
| 7 February 1972
-15 February 1972 |
pegged; 1 Ghana new cedi = US$0.78 = 0.450182g gold (nominally), or 3.34 new cedis = UK£1 | Ghana, decision of National Liberation Council, 5 February 1972, cited in Bank of Ghana annual report, 30 June 1972: 34 | RR: Parallel market premium in mid double digits. | Partly reversed the previous devaluation. |
| 16 February 1972
-30 June 1972 |
pegged; 1 Ghana cedi = US$0.78 = 0.450182g gold (nominally), or 3.34 cedis = UK£1 | Bank of Ghana annual report, 30 June 1972: 34 | RR: Parallel market premium in low to mid double digits. | Changed the name of currency from the new cedi to simply the cedi. |
| 1 July 1972
-23 January 1973 |
pegged; 1 Ghana cedi = US$0.78 = 0.450182g gold (nominally) | IMF ARER (1983: 204) | RR: Parallel market premium in low to mid double digits. | The Bank of Ghana ceased quoting a pegged exchange rate for the pound sterling after the United Kingdom floated the pound sterling on 23 June 1972. |
| 24 January 1973
-14 February 1973 |
pegged, multiple rates; official rate 1 Ghana cedi = US$0.78 = 0.450182g gold (nominally) | Ghana, Export Bonus Decree, 24 January 1973, cited in IMF ARER (1984: 184) | RR: Parallel market premium around 20%. | The decree introduced multiple exchange rates, retroactive to 13 September 1972. |
| 15 February 1973
-31 March 1978 |
pegged, multiple rates; official rate 1 Ghana cedi = US$0.8696 = 0.450182g gold (nominally) | IMF ARER (1974: 184) | RR: Parallel market premium starting in low double digits, then rising to nearly 1,000% in 1977. | Did not follow the devaluation of the US dollar on 13 February 1973. |
| 1 April 1978
-18 June 1978 |
pegged; multiple rates; official rate 1 Ghana cedi = US$0.8696 | International Monetary Fund, Board of Governors, Resolution No. 31-4, 30 April 1976 ("Second Amendment") | RR: Parallel market premium in triple digits. | The system of gold par values officially ended by agreement of IMF members. |
| 19 June 1978
-22 April 1983 |
managed float, multiple rates (but see Remarks) (IMF: the managed float category began in 1982) | IMF ARER (1979: 177; 1983: [page to come where classified as managed float-see Appendix]) | RR: Parallel market premium in triple and quadruple digits. Freely falling / managed float. | Floated in the midst of high inflation and political uncertainty. The cedi was adjusted from 1 Ghana cedi = US$0.5917 to 1 Ghana cedi = US$0.3636 on 28 August 1978; this rate, alternatively expressed as 2.75 Ghana cedis = US$1, then became rather inflexible in practice. A currency confiscation occurred on 13 March 1979 (Ghana, government announcement of 9 March 1979, cited in Bank of Ghana annual report 1969: 16). The confiscation aimed "to reduce excessive cash holdings of the non-bank public" and to cut off illegal holdings of old cedis outside Ghana. Old cash cedis were exchanged for new cedis at 10 old Ghana cedis = 7 new Ghana cedis up to 5,000 cedis. Bank deposits were not affected. Another currency confiscation occurred on 8 February 1982: the 50-cedi note, the largest in circulation, was demonetized. Nationals could exchange 50-cedi notes for other currency in unlimited amounts at 1-to-1, but foreigners were not allowed to make any exchange (Bank of Ghana annual report, 30 June 1983: 14). |
| 23 April 1983
-9 October 1983 |
pegged, dual rate; official rate 23.375 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1983: 1-2; IMF ARER (1984: 212) | The second rate was
29.975 Ghana cedis =
US$1.
RR: Parallel market premium in quadruple digits. Freely falling / managed float. |
Simplified the exchange rate system, apparently as an attempt to foster some sense of public confidence in a government that had only recently gained power. |
| 10 October 1983
-25 March 1984 |
pegged, dual rate; official rate 30 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1984: 5; IMF ARER (1984: 212) | The second rate was
5% above the official
rate.
RR: Parallel market premium in low triple digits. Freely falling / managed float. |
Devalued and eliminated multiple exchange rates. However, a 5% tax imposed on certain purchases of foreign exchange meant that a dual exchange rate remained in effect. This was a period in which a still new government was trying to grope towards a coherent economic policy. |
| 26 March 1984
-23 August 1984 |
pegged, dual rate; official rate 35 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1984: 5; IMF ARER (1985: 224) | The second rate was
5% above the official
rate.
RR: Parallel market premium falls below 200%. Freely falling / managed float to May 1984. |
Devalued. |
| 24 August 1984
-3 December 1984 |
pegged, dual rate; official rate 38.50 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1985: 8; IMF ARER (1985: 224) | The second rate was
5% above the official
rate.
RR: Parallel market premium around 160%. Freely falling from June 1984. |
Devalued. |
| 4 December 1984
-18 April 1985 |
pegged, dual rate; official rate 50 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1985: 8; IMF ARER (1985: 224) | The second rate was
5% above the official
rate.
RR: Parallel market premium above 100%. Freely falling. |
Devalued. |
| 19 April 1985
-11 August 1985 |
pegged, dual rate; official rate 53 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1985: 8; IMF ARER (1986: 247) | The second rate was
5% above the official
rate.
RR: Parallel market premium above 100%. Freely falling. |
Devalued. |
| 12 August 1985
-6 October 1985 |
pegged, dual rate; official rate 57 Ghana cedis = US$1 | IMF ARER (1986: 247) | The second rate was
5% above the official
rate.
RR: Parallel market premium above 100%. Freely falling. |
Devalued. |
| 7 October 1985
-12 January 1986 |
pegged, dual rate; official rate 60 Ghana cedis = US$1 | IMF ARER (1986: 247) | The second rate was
5% above the official
rate.
RR: Parallel market premium falls below 100%. Freely falling. |
Devalued. |
| 13 January 1986
-18 September 1986 |
pegged, dual rate; official rate 90 Ghana cedis = US$1 | Bank of Ghana annual report, 30 June 1986: 76; IMF ARER (1987: 232) | The second rate was
5% above the official
rate.
RR: Parallel market premium often around 100%. Freely falling to April 1986; freely falling / freely floating from May 1986. |
Devalued. |
| 19 September 1986
-20 February 1987 |
pegged, multiple rates; official rate 90 Ghana cedis = US$1 (IMF: independent float) | IMF ARER (1987: 232) | The third rate was an
independent float.
RR: Parallel market premium above 100%. Freely falling / freely floating to September 1987. |
Established a third, floating rate alongside both the official rate and the rate involving a 5% tax. The IMF classifies Ghana as an independent float because the third rate determined the exchange rate at the margin. I continue to clasify it as pegged because of the official rate. |
| 21 February 1987
-31 January 1988 |
independent float, dual rate | Bank of Ghana annual report, 30 June 1987: 85; IMF ARER (1988: 222, 225) | RR: Parallel market premium falling from mid double digits to single digits by July 1990. Small or no premium from 1993. Freely floating from October 1987. | Floated; the initial rate was 150 Ghana cedis = US$1. All foreign-exchange transactions settled through the official banking system were settled in accord with the weekly auction rate. The 5% tax on purchases of foreign exchange for certain transactions continued to apply. |
| 1 February 1988
-26 April 1990 |
independent float, multiple rates | IMF ARER (1989: 183) | The bureau rate was a
free float. On 30
December 1998 the
auction market rate
was 230 Ghana cedis =
US$1, while the
bureau rate was 310-334.84 Ghana cedis =
US$1.
RR: Parallel market premium falling from mid double digits. Freely floating to July 1989; freely falling / managed float from August 1989. |
The government allowed foreign-exchange bureaus. The bureaus quoted their own rates different from the auction rate, thus introducing a third exchange rate. On 29 December 1989 a so-called wholesale foreign-exchange auction began (IMF ARER 1990: 180). |
| 27 April 1990
-1993 |
independent float, dual rate | IMF ARER (1991: 190) | RR: Parallel market premium falling from mid double digits. Freely falling / managed float to September 1990; managed float from October 1990. From early 1993 the parallel market premium was in single digits. | The foreign-exchange market used by foreign-exchange bureaus united with the interbank foreign-exchange market , reducing the number of exchange rates from three to two. |
| 1993
-29 June 2001 |
independent float | IMF ARER (1994: 191) | RR: Small or no parallel market premium to December 1998, when data end. Managed float to February 1994; freely falling / managed float March 1994-July 1996; managed float August 1996-October 1999; freely falling / managed float November 199-March 2001; managed float from April 2001. | Foreign-exchange fees cease to be mentioned as of 1993. Ghana accepted Article VIII of the IMF Articles of Agreement on 2 February 1994. From 6 October 1999 the average exchange rate was based on the average rates reported by authorized banks in their transactions; before that, the authorized banks did not always apply to their customers the rate in the interbank market. |
| 30 June 2001
-present (2005) |
managed float | IMF ARER (2002: 375) | RR: Managed float until data end in December 2001. | The IMF reclassified the exchange rate because "there is evidence that the authorities are indirectly intervening in the foreign exchange market as conditions require." |