Vice President of IMANI Africa, Bright Simons, has underscored the importance of a stable exchange rate, describing it as critical for effective business planning and private sector growth.
According to him, frequent fluctuations in the cedi create uncertainty, disrupt business operations, and make it difficult for companies to plan and manage costs.
Mr Simons said the exchange rate should remain relatively stable against Ghana’s major trading partners to support predictable economic activity.
He made the remarks during an interview with Bernard Avle on Channel One TV’s The Point of View on Monday, January 5.
“What is important is that it shouldn’t fluctuate wildly. Stability of the exchange rate is the most important thing, not necessarily appreciation. Stability should be in sync with the business cycle. Because mostly, it is about the private sector,” he said.
Mr Simons explained that business cycles are often complex and involve multiple stages, including the purchase of inputs, production, sales, and revenue recovery, all of which depend on predictable economic conditions.
“So if I’m a business person, the business cycle can be complicated. But my decision around buying inputs, making the produce and selling and getting it back—whatever that cycle might be—it’s good that my planning sequence aligns with an exchange rate that is stable,” he noted.
He stressed that while businesses can manage some internal factors, sudden changes in macroeconomic indicators such as exchange rates and inflation are beyond their control and can derail operations.
“Businesses need stability within their control. The factors shouldn’t change too much. If the exchange rate, which I can’t control, radically changes, if inflation radically changes, it doesn’t matter what I do as an entrepreneur, business manager or corporate leader—everything goes awry,” Mr Simons added.
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