Is the Cedi Slipping or a Strategic Play Ahead of $4bn Cocoa Loan?

Ghana’s currency has come under fresh pressure in recent days, raising questions about whether the cedi’s weakness is a sign of underlying fragility or a calculated move as the country prepares to welcome over $4 billion through the new COCOBOD loan arrangement. The sharp swings have left many anxious, with some wondering whether this is a genuine market-driven fall or a deliberate allowance to maximize cedi value from the dollars expected to land before the end of 2025.

The Cedi Under Pressure

Within just three days, the local unit slid from about ₵10.97 to nearly ₵11.75 to the dollar, a depreciation of close to 80 pesewas. The losses were broad-based, with the cedi also tumbling against the pound and the euro. For households and businesses that rely heavily on imports, such rapid changes translate immediately into higher costs, and suppliers are already adjusting prices in anticipation of rising inflation. The sudden slide has therefore rekindled debate about the central bank’s grip on the market at a time when international reserves still stand above $11 billion.

Yet the timing of the depreciation is what makes it more intriguing. In the coming months, the Ghana Cocoa Board (COCOBOD) is set to secure about $4 billion through its new financing model, which replaces the long-standing syndicated loan arrangement. 

Under this structure, international cocoa buyers must deposit at least 60 percent of the value of their contracts upfront, guaranteeing a steady injection of dollars into Ghana’s economy. This facility is being described as the largest expected loan inflow for 2025, and in normal times, it should bolster reserves and strengthen the cedi. Instead, the currency is weakening now, just as the loan is being finalized.

Dollars, Cedis and the Real Value Question

This is not the first time exchange rate movements have blurred the real value of Ghana’s cocoa economy. Earlier this year, when the government announced the new farmgate price, the headline numbers looked impressive in dollar terms, rising from $3,100 to $5,040 per metric ton. But when converted into cedis, the gain to farmers amounted to only about ₵128 per bag, exposing how exchange rate swings can turn what seems like a big dollar increase into a modest benefit on the ground. That contrast has not been forgotten, and it now colors the way many observers view the current cedi depreciation.

At the heart of the matter is whether the recent fall is being driven by fundamentals such as speculative demand for dollars, seasonal import pressures, or lingering doubts about the broader economy, or whether the slip is being quietly tolerated so that the incoming $4 billion cocoa loan translates into more cedis. At an exchange rate of ₵10.55, the loan would have yielded about ₵42 billion. At today’s ₵11.75, the same loan converts into nearly ₵47 billion, handing government and the central bank a much bigger cushion in local currency terms.

Whether by design or by default, the depreciation raises uncomfortable questions. Allowing the cedi to fall may ease fiscal pressures in the short term, but it risks eroding confidence, fuelling inflation and diminishing the real gains of farmers and households. 

What is clear is that Ghana’s dependence on foreign loans and inflows continues to make the cedi’s value, and people’s livelihoods, hostage to timing and perception. Until structural weaknesses such as import dependence and limited export diversification are addressed, the question will keep returning: is the cedi truly slipping, or is it being nudged to slip for the cocoa loan?

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