Business News of 2014-07-22

BoG given 2 weeks to file defense in cedi suit

The Supreme Court has directed the Bank of Ghana (BoG) to submit in fourteen days their statement of case, in the current suit filed against it by a private legal practitioner, Dr John Ephraim Baiden, on the continuous depreciation of the cedi.

Dr Ephraim Baiden hurled the BoG to the Supreme Court for failing to stabilize the cedi seeking a declaration that upon a true and proper interpretation of Article Article 183(2)(a) of the constitution which says “The Bank of Ghana shall promote and maintain the stability of the currency of Ghana and direct and regulate the currency system in the interest of the economic progress of Ghana”, and Section 4(b) of the Bank of Ghana Act, 2002, which says the central bank “shall promote by monetary measures the stabilization of the value of the currency within and outside Ghana.” the BoG has neither promoted nor maintained a stable currency for Ghana.

The cedi has depreciated against the dollar by over 27 percent this year alone. The Bank of Ghana in reaction to the suit filed a writ of preliminary objection to strike out the suit, indicating the Supreme Court is not the forum to address the issue.

The court slated today to rule on the preliminary objection, but did not do so because the Bank of Ghana had not submitted its statement of case to defend the suit. The plaintiff, Dr Ephraim Baiden told Citi Business News after court proceedings that the central bank was not performing its role stipulated by law.

“They need to file their defense. If they have delivered a stable currency for the country, they should be able to speak to that. Their record speaks for itself. Their record is a record beyond comprehension. It is not central banking when it comes to managing our currency. They are not practicing central banking, they are practicing central destruction”, he said.

According to him, “I have a case because, it is so clear that they are in breach of the constitution and also in breach of their legal operating framework which is the Bank of Ghana Act 2002.”

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