BoG Allays Gold For Oil Policy Fears

Dr. Ernest Addison

THE CENTRAL Bank allayed fears surrounding the government’s gold for oil policy on Monday, assuring Ghanaians that there is enough gold in the country to sustain the barter policy.

Director of Financial Market at the Bank of Ghana (BoG), Stephen Opata said the central bank is well-positioned to meet the demand for the 160,000 ounces of gold required every month to trade for the oil.

Mr. Opata gave the assurance when he appeared before the Public Accounts Committee (PAC) of Parliament on Monday, during which he indicated that gold production shot up last year, making available enough quantity for purchase by BoG to sustain the programme.

“I must say that the numbers we are currently looking at is about 160,000 ounces per month, and that will represent about 50% to 60% of the consumption of the country.

“According to what PMMC indicates, I think we have volumes to support the programme,” Opata noted, allaying fears surrounding the programme.

The country spends about $4.8 billion annually to buy fuel, and the government said bartering for oil with gold will immediately save Ghana $3 billion or approximately 4% of GDP in foreign exchange costs, to reduce pressure on the local currency.


In November last year, the government opened talks and reached a tentative agreement with the Emirates National Oil Company for a barter arrangement to enable the nation to buy fuel with gold.

The first consignment of the ‘Oil for Gold’ deal arrived on Sunday at the Tema Port from Dubai, and the consignment consisted of 40,000 metric tons of oil, which is expected to be increased subsequently.

Currently, Ghana has a monthly oil consumption of 180,000 metric tons of oil, which it uses millions of dollars to import fuel, thereby increasing demand for the US currency at the expense of the cedi that depreciated 57% in 2022.

The oil product-gold swap deal would help stabilise the economy and stem the slide in the cedi that tends to fuel inflation.

Prior to this, the government ordered large mining companies to sell 20% of their gold to BoG from January 1, 2023, and all Community Mining Schemes (CMS) to sell their gold outputs to the PMMC.

“Effective January 1, 2023, all Community Mining Schemes (CMS) shall sell their gold outputs to the Government through PMMC. All mining licences for CMS shall include a clause mandating licensees to sell their gold output to the Government,” Vice President Dr. Bawumia quoted a directive by the Lands and Natural Resources Minister.

BY Ernest Kofi Adu

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