There is a growing call over the long-term sustainability of Ghana’s domestic gold purchasing strategy after the Bank of Ghana (BoG) posted an estimated GH¢8.8 billion loss linked to its Gold for Reserves programme.
The latest Bank of Ghana’s (BoG) audited financial statement for 2025 further reveals that the Gold for Oil initiative also recorded a loss of GH¢ 203 million.
Amid these losses, policy analyst Alfred Appiah is among a rising number of voices urging authorities to take a step back and reassess the framework driving the initiative. He warns that the current model risks eroding capital rather than strengthening the country’s external buffers.
He explains that there is a widening gap between the cost of acquiring gold locally and the value ultimately realised in foreign exchange markets. While the programme has been praised for boosting reserves and reducing reliance on external borrowing, Alfred Appiah argues that the conversation has been overly fixated on forex inflows, with insufficient attention paid to how much it costs to generate those inflows.
“It’s not just about buying gold and bringing in foreign exchange. In the past, emphasis has been placed on how much forex is generated, but the cost at which it is obtained and the impact on trading capital and the BoG’s books are equally important,” he noted.
The issue is particularly pressing given the scale of public funds involved. With about GH¢4.5 billion reportedly channelled into gold trading operations through the Goldbod, concerns are mounting that the capital base could be strained if losses persist under the current structure.
A key challenge lies in the pricing regime of the gold purchasing program. Buying gold from small-scale miners at rates that are competitive enough to discourage smuggling, yet discounted enough to cover operational and trading costs, remains a delicate balancing act.
Push prices too low, and supply dries up or shifts to informal channels. Push them too high, and margins vanish.
For Alfred Appiah, timing, too, is a critical factor. Gold price volatility on the international market means that delays between purchase and sale can quickly turn potential gains into losses. Without efficient trading strategies and risk management tools, the programme remains exposed.
Alfred Appiah also underscores enforcement gaps, noting that persistent smuggling undermines volumes and weakens the programme’s effectiveness. Even a well-designed pricing model, he suggests, cannot succeed if significant quantities of gold continue to bypass official channels.
He fears that without structural adjustments, the initiative risks becoming financially unsustainable, placing additional pressure on the central bank’s balance sheet at a time when stability is paramount.
Rather than abandoning the programme, Appiah is calling for a more disciplined and transparent approach; one that integrates cost controls, stronger enforcement, smarter timing strategies, and a clearer alignment between trading operations and reserve management objectives.
He notes, “The challenge remains how to purchase gold from small-scale miners at a discount sufficient to cover trading and related costs without depleting capital while also reducing a loss in volumes. Timing also matters, as does enforcement to reduce smuggling. There is still a lot of work to be done.”
“If we rush to declare success prematurely while losses are being incurred, the hard work will not get done,” he added.
For now, the call is for the government to refine the model to deliver both strong reserves and financial sustainability without sacrificing one for the other.
