Prof. Yegandi Imhotep Paul Alagidede, the newly appointed Bank of Ghana Chair in Finance and Economics at the University of Ghana, has proposed that backing the cedi with strategic national resources such as gold and cocoa could deliver long-term currency stability. 

Speaking at the inaugural lecture of his tenure at Legon last week, he argued that Ghana’s dominant position in gold production and its strong agricultural exports provide a solid basis for a multi-resource-backed monetary system.

“Ghana’s dominant position in gold production — ranking first in Africa — provides a strong foundation for an exchange rate and banking system partially backed by gold,” Professor Alagidede said. 

“In addition, Ghana’s cocoa exports, which remain globally significant, and its untapped bauxite reserves allow for a multi-resource collateral system.

A gold-backed digital currency, monitored by the central bank and audited through blockchain technology, could stabilise the Ghanaian cedi while enhancing public trust.”

This advocacy by Prof Alagidede is in sync with similar concepts such as the gold-for-oil and gold for reserve programmes championed by former Vice President Dr Mahamudu Bawumia, which leveraged the country’s gold reserves to reduce foreign exchange demand for fuel imports and to support the cedi. 

Advocates say such initiatives demonstrate the potential of resource-backed strategies to address currency volatility and build investor confidence.

At the lecture, both the Governor of the Bank of Ghana, Dr. Johnson Asiamah and the head of research at Bank of Ghana, Dr. Philip Abrado-Otu acknowledged the significant role played by the gold for reserve programme in stabilising the cedi. 

During his tenure as the Bank of Ghana Chair, Prof Alagidede will conduct collaborative research with the Bank of Ghana, develop grant proposals, disseminate research findings, teach and supervise graduate students, and foster stronger links between the University of Ghana Business School, the Department of Economics, and the financial services industry.