The Vice President and flagbearer of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia, has unveiled plans for the next NPP government to stabilize the Ghana cedi through a gold purchase programme.
Dr. Bawumia, speaking at the Manifesto launch in Sekondi-Takoradi in the Western region, identified two key policies that have been instrumental in averting economic disaster during the recent crisis, the Bank of Ghana’s domestic gold purchase program and the Gold for Oil (G4O) programme.
He stated, “The pilot has worked for a number of companies, some of which wanted to forex to repatriate profits. We have, thus, found a solution to the profit reparation problem without destabilising our local currency. This also brings major comfort to foreign investors operating in our country. I believe from the success of the pilot scheme, we can confidently say that we have found a solution to the age-old foreign exchange problem that successive governments have struggled to contain, and which invariably led to inflation and other macro-economic challenges.”
The NPP flagbearer further indicated that his government will fully institutionalize the Gold-for-Forex program as part of broader efforts to transform the structure of the Ghanaian economy.
He explained, “Simply put, the domestic gold purchase program (DGPP) is a policy which allows the Bank of Ghana to boost its foreign exchange reserves by buying locally produced gold with cedis. Gold purchases from this program alone have amounted to US$5 billion in the last couple of years. With Ghana’s unexplored gold reserves estimated at 5 billion ounces (and a market value today of US$10 trillion).”
Dr. Bawumia also announced plans to expand the gold purchase program to meet all major forex demands.
He elaborated, “Put simply, if for example, a company wants dollars, we will take their cedis, buy gold, and give them dollars. In this situation, demand equals’ supply. The gold purchase program will, therefore, provide the anchor that our local currency has always lacked.”
