Macroeconomic Aspects of Multiple Exchange Rate Regimes: the Case of Ghana

In April 1983 Ghana began a series of exchange rate policy reforms that by 1988 had transformed the exchange rate regime from one in which a rigidly fixed official exchange rate operated alongside a thriving black market to one in which market forces determined exchange rates on an official auction and on legalized foreign exchange bureaus. Concurrent with the exchange rate reforms, controls on imports were progressively removed, culminating in 1989 in the abolishing of import licensing, which had operated in Ghana since 1961. The black market for foreign exchange, while not completely eradicated, is now a shadow of its former self, confined to the fringes of the foreign exchange bureaus and motivated more by a desire on the part of dealers to avoid taxes rather than exchange and trade controls.