GH¢1.7bn GoldBod loss misconstrued – IEA

The Institute of Economic Affairs (IEA) has dismissed allegations of a GH¢1.7 billion loss in the Bank of Ghana’s Domestic Gold Purchase Programme, attributing much of the figure to revenue and foreign-exchange valuation differences rather than an actual loss to the Ghana Gold Board (GoldBod). Professor Alexander Bilson Darku, Director of Research at the IEA, clarified that the reported amount included service fees, assaying fees, and foreign-exchange valuation differences arising from GoldBod’s operations.

He emphasized that service and assaying fees were payments made by the Bank of Ghana (BoG) to GoldBod for services rendered, thus constituting revenue to GoldBod. The majority of the GH¢1.7 billion figure, approximately 90%, was due to an exchange-rate valuation issue. GoldBod purchased gold for the BoG, with proceeds converted from US dollars into cedis using the Central Bank’s reference exchange rate.

Differences between the purchase exchange rate and the valuation exchange rate could result in a book accounting loss, though this did not necessarily mean a depletion of national wealth. Prof. Darku urged careful scrutiny of GoldBod’s financial operations, especially as the institution moves away from BoG financing to private sector funding.

He highlighted the institution's role in boosting gold exports, attracting foreign-exchange inflows, and strengthening reserves, which contributed to cedi appreciation and stability. However, he cautioned against overreliance on gold for exchange-rate stability and reserve accumulation, advocating for diversified economic strategies such as broader export promotion, import substitution, and enhanced local ownership.

Prof. Darku also praised the government for achieving macroeconomic stabilization and called for its transformation into sustainable growth, employment, and economic development, emphasizing the need for reforms in the natural-resource sector and stronger enforcement of fiscal policies.