Ghana’s gold-driven economic gains could vanish within months – Prof Bokpin
Professor of Finance and Economist at the University of Ghana, School of Business (UGBS), Godfred Bokpin, has warned that Ghana’s gold-driven macroeconomic stability could be wiped out within months if global gold prices decline sharply.
Ghana's recent economic gains driven by gold production may be short-lived, according to Professor Godfred Bokpin, a finance expert at the University of Ghana Business School. During an interview on Joy FM, Professor Bokpin warned that a sharp drop in global gold prices could erase the country's recent improvements in just a few months.
He noted that Ghana's improved macroeconomic indicators are highly sensitive to changes in international gold prices and should not be viewed as stable. If gold prices fall by more than 40%, the gains could disappear within six to eight months. Professor Bokpin cautioned that such a price shock could wipe out the economic progress reported so far, leaving the economy vulnerable.
He urged policymakers to conduct stress tests and sensitivity analyses to gauge how the economy, especially its foreign exchange position and reserves, would fare in the event of a significant drop in gold prices. Professor Bokpin also called for a more comprehensive approach to assessing the gold sector, considering not just foreign exchange earnings and reserve accumulation, but also the environmental impacts of gold production, such as deforestation and water pollution.
He emphasized that Ghana's long-term development strategy should move beyond reliance on primary commodities and should prioritize economic growth that is environmentally sustainable.
Written by urgent.news from MyJoyOnline Ghana's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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