BoG eases forex restrictions to increase dollar supply

The Bank of Ghana reversed some restrictions on the use of the dollar and euro to boost foreign exchange supplies after companies said the rules made it more difficult to obtain cash.

The central bank overturned a rule that requires exporters to convert proceeds from sales abroad to the cedi in five days, Benjamin Amoah, head of financial stability, told reporters in Accra, the capital. Foreign companies will be allowed to pay local businesses using currencies other than the cedi, and exporters can retain 60 percent of revenue in foreign denominated accounts and convert 40 percent within 15 days, he said.

“We’ve seen that some economic agents, because of misapplication of the rules, are having problems, and we’re streamlining it,” he said. “With the review it is expected that availability of foreign currency on the market will increase.”

The bank issued orders in February requiring all companies use the cedi in local transactions to prevent the economy from becoming dependent on foreign currencies. The bank also limited the use of dollars and euros to exporters and importers and set limits on who can have accounts denominated in foreign currencies.

The cedi gained 2.7 percent to 3.035 per dollar as of 12:22 p.m. in Accra yesterday, paring losses this year to 22 percent, the biggest drop among 24 African currencies monitored by Bloomberg.