Following the announcement of the policy, Ghana’s new Ghana Accelerated National Reserve Accumulation Policy (GANRAP) 2026–2028 has been welcomed as a smart and sovereign rethink of how the country builds foreign exchange buffers, but that is not all.
Although the policy has earned praise for moving away from borrowed reserves, an economist is cautioning that Ghana may not need to aim as high as the headline target suggests.
According to Dennis Nsafoah, Assistant Professor of Economics at Niagara University and member of the Research Committee at Tesah Capital, the gold-backed reserve strategy as “a decisive and sensible shift.”
In a brief on the policy copied to The High Street Journal, instead of relying on Eurobonds, swaps, and other short-term foreign borrowings to inflate reserves, an approach that proved fragile during the 2022–23 crisis, GANRAP proposes purchasing domestically produced gold and retaining export proceeds to strengthen external buffers.
“Rather than relying on Eurobonds, swaps, and other costly short-term instruments, the government proposes to build foreign exchange reserves by purchasing domestically produced gold and retaining the export proceeds. This strategic shift deserves credit,” Dr. Nsafoah.
The Bigger Question: How Much Is Enough?
While the method is sound, Dr. Nsafoah questions the scale of the ambition. He explains that GANRAP targets 15 months of import cover by 2028, a level he believes is difficult to justify economically given Ghana’s current reserve strength.
By the end of 2025, Ghana’s Gross International Reserves stood at approximately US$13.8 billion, equivalent to 5.7 months of import cover.
This, he says, is not a weak position. He adds that it is comfortably above traditional reserve adequacy benchmarks.
What Do Global Standards Say?
In his explanations, he adds that international reserve adequacy frameworks provide useful context.
One widely cited benchmark, the Greenspan–Guidotti rule, suggests countries should hold enough reserves to cover short-term external debt maturing within one year. For most emerging economies, this often corresponds to about 3–5 months of import cover.
Another influential framework developed by IMF economists Olivier Jeanne and Romain Rancière views reserves as insurance against sudden capital flow reversals. Their research generally places optimal reserves for economies with Ghana-like characteristics in the 5–8 month range.
Measured against these standards, Ghana’s current 5.7 months sits comfortably within, and in some cases above, recommended levels.
“A reserve buffer in the range of 5 to 8 months of import cover, particularly for a commodity-exporting economy with gold, cocoa, and oil revenues and a flexible exchange rate, is widely regarded as more than adequate to insure against sudden stops, smooth exchange-rate volatility, and sustain market confidence,” he explained.
He added, “Ghana is no longer in a reserve-scarce regime. The policy challenge is not to escape vulnerability at all costs, but to avoid overshooting into an excessively costly buffer.
A Balanced Perspective
Dr. Nsafoah is not opposing the policy. However, he is calling for calibration.
He supports the shift toward domestically anchored reserve accumulation. But he urges policymakers to weigh ambition against efficiency.
As the government rolls out GANRAP, the debate may increasingly centre not on whether building reserves is good, it clearly is, but on how much is economically optimal.
