The Minority in Parliament is demanding the immediate halt of the printing and subsequent circulation of the newly introduced GH¢100.00 and GH¢200.00 notes by the Bank of Ghana, ABC News can report.
According to them, the introduction of the new notes by the Central Bank is a needless exercise and an avoidable waste of the country’s limited resources, adding that the reasons offered are “unsatisfactory”.
They argue, for instance, that although the higher denomination notes may bring government some revenue, the Ghanaian economy stands to suffer an attendant inflation which will be a cost to the people.
“Why would the Bank of Ghana claim to be striving to control inflation at great cost by mopping up excess liquidity using short-term Bank Bills, and then engage in an action that will cause massive inflation?” the minority queried in a statement released Wednesday.
The Minority also accused the Central Bank of using the decision as a smoke screen to rake in funds which in the long run impact Ghanaians negatively.
“The Central Bank is likely to be making a profit of about GH¢3.8 billion if it prints 20 million pieces of the GH¢200 notes. The Central Bank engineers this kind of revenue because they have sole monopoly to issue the monetary base of the country. In practice, this kind of currency engineering is usually accompanied with inflation which causes the holder of real money balances to lose,” the statement alleged.
“We hereby serve notice that a future NDC government to be inaugurated in 2021 will conduct a forensic audit into this entire exercise as well as others, which would focus on the individual roles played by the members of the Bank of Ghana Board and friends and family of President Nana Addo Dankwa Akufo-Addo,” it added.
Ghana’s Central Bank on Friday, November 29, 2019, introduced two higher denominations of the Ghana cedi – notes GH¢100.00 and GH¢200.00 and a GH¢2.00 coin which would replace the withdrawn GH¢2.00.
The new denominations are however yet to go into circulation.
The introduction of the new notes according to BoG is to among other things “complement the existing series to ensure customer convenience and bring about efficiency in the printing of currency to generate savings for the country.”
“These new higher value denominations will restore the dollar value of the higher denomination to about US$40, not quite close to levels in 2007, but high enough to significantly reduce the deadweight burden and high transaction cost in making high-value purchases in a cash-based economy like Ghana,” it held.
But the minority finds the reasons absurd as “there is no economic justification for the decision,” adding that the move “amounts to an affront” to the government’s agenda of a paperless economy.
“Sadly, the Bank of Ghana is engaging in this waste of public resources at a time when its own balance sheet is in a very precarious state and needing re-capitalization. Another critical issue must be why the Bank of Ghana is refusing to disclose the cost of printing the new 100-note and 200-note. If there was indeed such great need for the high value notes, the Governor must rather be happy to give the public a full transparent disclosure of the cost,” the statement averred.
Read the minority’s full statement below