Don’t credit GoldBod for Ghana’s macroeconomic stability – Bokpin

Economist Professor Godfred Alufar Bokpin has warned against giving credit to the Ghana Gold Board (GoldBod) for Ghana's recent macroeconomic stability. Professor Bokpin asserts that while GoldBod has successfully reduced gold smuggling and increased foreign exchange retention in the country, the broader improvements result from fiscal and monetary policy. He emphasizes that the primary responsibility for macroeconomic stability lies with monetary and fiscal authorities, such as the Bank of Ghana.

GoldBod's role in Ghana's macroeconomic stability, according to Professor Bokpin, includes reducing gold smuggling and increasing foreign exchange retention. He notes that both the New Patriotic Party (NPP) and the National Democratic Congress (NDC) recognized challenges surrounding illegal mining, gold production, and gold export reporting before the 2024 elections.

The NPP proposed lowering the final withholding tax on gold exports to encourage declarations, while the NDC opted to establish GoldBod as the entity responsible for buying and exporting gold, particularly from artisanal and small-scale miners.

Professor Bokpin acknowledges that the domestic gold purchase arrangement, for which GoldBod became the face from 2025, has led to significant financial losses. He believes these losses must be considered when assessing the program's overall impact. The economist argues that macroeconomic stability cannot be attributed to GoldBod because that responsibility belongs to monetary and fiscal authorities, which includes the Bank of Ghana.

The professor highlights the substantial financial losses associated with the domestic gold purchase programme, suggesting that the overall cost could exceed initial estimates. He points to the abolition of the 1.5% withholding tax on artisanal and small-scale gold production as another financial burden on the state. Professor Bokpin also mentions that the fiscal implications become significant when considering the value of gold exports from artisanal and small-scale miners, which surpass $10 billion.

Despite acknowledging GoldBod's gains in crowding in gold-related foreign exchange, Professor Bokpin insists that the substantial losses resulting from the programme should not be overlooked. He believes that the benefits in terms of macroeconomic stability are substantial, but the huge costs associated with implementing the intervention must also be recognized.

The government, GoldBod, and the Bank of Ghana have acknowledged that the losses are unsustainable, and they are pursuing an exit plan to reduce these losses to about 5% going forward.