Vice President of IMANI Center for Policy and Education, Bright Simons has disputed claims that the Bank of Ghana’s Domestic Gold Purchasing Program (DGPP) has significantly contributed to increasing the country’s official gold production.
Bright Simons reveals that official data of Ghana’s total gold exports before and after the program was introduced in 2021 does not support the claim.
The Bank of Ghana in 2021 introduced the DGPP. Years down the line officials of the previous administration and the Central Bank have often touted the program as significantly increasing the country’s official gold output.
The BoG says the program since its implementation has been able to purchase gold valued at $9 billion. With these estimates, Bright Simons’ analysis projects about 900,000 ounces of gold purchased annually since June 2021.
One of the goals of the program is to curb the smuggling of gold from small-scale miners by offering competitive prices. This strategy, BoGs aims to ensure that illicit gold is redirected to legal channels and hence boost the official gold production.
“If gold previously traded illegally is rechanneled and sold legally to the BoG, then it would increase the total small-scale supply of gold and consequently the total official gold. In simple terms, what was once invisible gold has, through the power of the DGPP, suddenly become visible to official statistics,” the Vice President of IMANI Africa explained.
Despite the touted success of improved official gold production, data published by Bright Simons suggest otherwise. The data sourced from the Ghana Chamber of Mines rather reveals that overall official production has slumped, undermining the claim that the DGPP is effectively “converting” illegal gold into official output.
The data cited by The High Street Journal reveals a consistent decline in Ghana’s official gold production since peaking in 2018. After recording 149.1 tons in 2018, official gold output has dropped by about 25%. Notably, even during the operational years of the DGPP, production continued to reduce recording 124.7 tons, 105.7 tons, and 114.5 tons in 2021, 2022, and 2023 respectively.
The sharp contrast between the BoG’s claim and the official figures of gold export raises a critical question about the purported success of the DGPP in increasing gold output.
With his analysis, he concludes that the claims of the officials of the previous government and the Bank of Ghana, in the face of the evidence presented appear very dubious and must be properly interrogated.
He said, “The proposition that gold that may previously have been traded illegally is now more likely to be passed through legal channels as a result of the DGPP feels somewhat dubious in light of the data.”
