The Ghanaian cedi is the official currency of Ghana. Its history dates back to colonial times and has undergone several changes throughout the years. Here’s a brief overview of how the Ghanaian cedi came into existence:
British West African Pound: Before the introduction of the cedi, Ghana used the British West African Pound as its currency. The British pound sterling served as the standard currency in the British West African territories, including Ghana, from the late 19th century until the mid-20th century.
Ghanaian Pound: In 1958, Ghana gained independence from British colonial rule and decided to establish its own currency. The Ghanaian pound was introduced as the national currency, with a conversion rate of one Ghanaian pound equal to one British pound.
Introduction of the Cedi: In 1965, Ghana decided to decimalize its currency system and introduced the new currency called the cedi. The exchange rate was set at 1 cedi to 1.2 Ghanaian pounds. The cedi was divided into 100 pesewas.
Redenomination: Over time, due to inflation and economic factors, the value of the cedi eroded significantly. In 2007, the government of Ghana implemented a redenomination process to revalue the currency and make transactions easier. The new currency, also named the cedi, was introduced, with 10,000 old cedis being exchanged for 1 new cedi.
Subsequent Adjustments: Since the redenomination, Ghana has made further adjustments to the currency, mainly through the issuance of higher denomination banknotes. In 2019, the Bank of Ghana introduced new banknotes with enhanced security features and updated designs to improve durability and curb counterfeiting.
It’s important to note that the history of the Ghanaian cedi is intertwined with Ghana’s political and economic developments. The currency’s value and exchange rates fluctuate based on various factors, including inflation, foreign exchange reserves, and government policies.