Ghana: The Cedi Shuffle

Like most of the rest of the world, the economy in Ghana has been suffering recently, a situation not helped by the continuing escalation of violence in neighbouring Côte d'Ivoire. The results are the typical macro-economic effects that seem to be controlled by invisible forces, such as high inflation rates, high government debt and a currency that's lost an incredible amount on the exchange markets. I don't even pretend to understand these things; I'm not convinced that those in power do either.

The most palpable effect of the economic downturn is the falling value of Ghana's currency, the cedi, on the foreign exchange markets. Ghana is not a member of the CFA union so it doesn't benefit from the euro-like propping up of the exchange rate that you see in places like Mali and Senegal, and recent economic stresses have pushed the cedi into free-fall. A couple of years ago there were around 8000 cedi to the pound; now it's around 13,000, which is great news if you're a traveller with pounds in your pocket, but awful news if you're a Ghanaian trying to save his cedis.

Normally this wouldn't be worth writing about, except to mention that for visitors, things are a lot cheaper in Ghana than they are in places like Mali; everything costs less, from accommodation to food, and even though a lot of hotels quote their prices in dollars so that the cedi price rides along with the exchange rate, it's still a completely different experience to the Sahel. You don't worry about whether you can afford that extra beer or dessert; the answer is always a happily gluttonous 'Yes!', and it's quite liberating. The problem is that until this morning, the largest note in Ghana was the 5000 cedi note.

Let's put this into perspective. This means that the highest value note is worth about 38p, with the two smaller notes being worth about 15p (2000 cedis) and 7.5p (1000 cedis); the coins aren't even worth considering, with the largest one being just under 4p, and the smallest being less than half a penny. This is all very well on paper, but when you try changing your travellers cheques, it all hits home. I decided to change some money in Kumasi, ready to hit the capital and the coast, so I fished out three slim £100 cheques and headed down to Barclays before they opened at 8.30am on Monday morning.

It might look like a normal Barclays Bank from the outside, and the counters might be all polished and the seats arranged in the same enticing way that they might be in London, but when the doors open at the Kumasi branch of Barclays, that's where the similarity ends. There are two doors into the bank, one on each side of the counters, and at 8.30am two security men go to the doors, signal to each other, and open up at precisely the same time. And through both doors pour the hordes of Kumasi, ready to do battle with the bankers.

I couldn't believe it; I stood there bewildered as the stampede of locals rushed round me like torrential rain down a dry creek bed, and two seconds after the doors opened, there were huge queues snaking round the room from all of the cashier points. If I wanted to change my cheques it was going to be a long wait, so I asked one of the employees which queue I should join and he smiled and pointed me upstairs.

Thank goodness; the queue was only one deep at the foreign exchange desk, and ten minutes later I'd managed to change my £300 into cedis. For my three cheques I got a wad of nearly 800 notes – that's around four inches of cedis – and this demonstrates the real problem of Ghanaian money; you need a bag to carry it in. The banks know this, and they hand you your money in a black plastic bag so you don't look too conspicuous. Imagine £300 in notes of 38p; it's quite a sight.

The National Museum in Accra dramatically demonstrates the slide of the cedi in its display of Ghanaian currencies through the years. The cedi was launched in 1965, when the largest note was the rare and valuable 100 cedi note, though the one cedi note was the cornerstone of the economy. By 1984 the bank had started issuing 200 cedi notes, but as the economic slowdown of the 1980s kicked in, higher notes of 500 cedis and 1000 cedis appeared in 1986 and 1991. The 5000 cedi note appeared in the 1990s, and it's only today that the bank has got around to releasing 10,000 and 20,000 cedi notes. For Ghanaians, who are used to carrying huge wads of notes around in their top pockets, it's a big relief, even though with 20,000 cedi notes, £300 would require some 200-odd notes, still a fair amount when it takes just 15 in England (and that's ignoring the £50 note). I tried to get my money in 20,000 cedi denominations, but as they were only launched this morning, the lady behind the counter could only smile and say, 'Everyone wants the new notes; I can only give you some.' I managed to save perhaps half a centimetre by getting 500,000 cedis in 20,000 notes; it barely made any difference.

As a result of the large amount of paper you need to carry round to survive in Ghana, the locals have developed a serious skill when it comes to counting notes. Every Ghanaian you meet can count a pile of money in two seconds flat, holding the notes in the left hand and flicking them off with the right, faster than the eye can see. Every transaction is always checked on both sides, not because people don't trust each other, but because it's so easy to make a mistake with such a large number of notes. In Ghana, everyone does the cedi shuffle.