Thread by @kanmyexcellent

TOPIC:
Ghanaian Cedi vs Nigerian Naira
SUB-TOPIC:
Denomination
Re-denomination
Purchasing Power Parity
Exchange Rate
Inflation Rate

Ghana introduced first Legal Tender to replace the British West African Pounce in 1965 and named it Cedi Note and Pesewa Coin like Nig Naira & Kobo

https://twitter.com/chaplinez70/status/1248512778064793600

2) Ghanaian had issued several Denomination since the introduction of first Local Currencies same way Nigeria did after abandoned the Old British West African Currency following the establishment of Central Bank of Nig in 1958. Like many other African, Ghanaian Cedi suffered /

3) Devaluation as a result of decades of high Inflation that weaken the Purchasing Power of Cedi. In 2007 the Largest of the Cedi is 20,000 Note, had a value of about US$2. The New Cedi was gradually phased out in 2007 in favor of the "Ghana Cedi" at Exchange Rate of 1:10,000 /p

4) Consequently, the Re-denomination regime relegated Ghanaian Cedi to background. Meaning that 20,000 penultimate the Re-denomination is (20,000/10,000) Cedi 2 today. The implication of eliminated 4digit render the currency weak. Ghana case is similar to Venezuela's experience /

5) By removing four digits, the Ghana cedi became the highest-denominated currency unit issued in Africa. It has since fallen to about 20% of its original purchasing power when the currency was re-denominated. Comparing Cedi as stronger than Naira is a terrible blunder. Example👇

6) Let us look at the Purchasing Power Parity between the two Countries:
A 33cl Can Malta sold at GHC4 in Ghana but sold at N120 in Nig.
Meaning what?
Next slide 👇

7) Remember that GHC1 today was GHC10,000 before Re-denomination. Therefore,
A Can Malta at GHC4 is like paying GHC40,000
Let Convert it to Naira:
Direct Exchange Rate =0.0149693
i.e 40,000 x 0.0149693
Therefore 1N =GHC598.772
Remember also that Nig never Re-denominate its Naira

Naira would've remain stronger like Dollar, but the adoption of Indirect Exchange Rate; Lower Foreign Reserves; Effect of Structural Adjustment Program of 1986; Introduction of Higher Denominations i.e N50, N100....... N1,000 by OBJ has weaken the value of Nig compare to Dollar/

9) In conclusion, it's very unfortunate that people have penchant for negativism and pessimism against Nig. Sadly, those you expect to be promoting the country are the major culprits of denigrating it. Nig is not yet better like we want it to be, but Nig is not worst as we think!