CPS says DGPP design makes losses inevitable, calls for overhaul

The Centre for Policy Scrutiny (CPS) has criticized the design of Ghana's Domestic Gold Purchase Programme (DGPP) as being "too generous," leading to likely losses. The think-tank is urging for a comprehensive review of the programme. While the immediate concern is the reported US$1.7 billion loss (around GH¢22 billion), the CPS wants the programme's structure to be examined as well.

They argue that the current design increases costs that could offset the benefits Ghana gains from buying gold domestically. The CPS warns that the programme's benefits might not stay positive forever, and losses could increase if the status quo persists. They suggest that the Bank of Ghana and GoldBOD's roles, concerning their financial exposure and transaction accounting, need close examination.

The review must also check if resources spent on the DGPP generate value equivalent to the costs, especially considering its potential impact on Ghana's foreign-exchange reserves and public finances. The call for a redesign comes as the programme is under intense public and political scrutiny due to its reported financial losses.

The CPS supports calls for Parliament to set up an Ad Hoc Committee to investigate these losses, recommending a bipartisan, transparent, and evidence-based inquiry. This inquiry should not only clarify what transpired and who is responsible, but also identify weaknesses within the DGPP and propose reforms to prevent future losses.

The Centre believes Ghana's gold and foreign-exchange resources should be managed to maximize public value while improving accountability and reducing unnecessary financial risks.