Since its rollout in January 2023, the Financial institution of Ghana has disclosed that it incurred losses of GH¢317 million in 2023 and GH¢1.82 billion in 2024 beneath the Gold for Oil (G4O) programme.
That brings complete losses to GH¢2.137 billion over two years.
The central financial institution injected GH¢4.69 billion into the programme, successfully shedding 45% of the capital it deployed in an effort to stabilise gas costs and assist the cedi.
On March 13, 2025, the Financial institution formally ended the Gold for Oil initiative, citing the heavy monetary losses sustained as the first purpose for shutting it down.
Gold for Oil (G4O) was launched in December 2022 in response to surging gas costs, with diesel retailing as excessive as GH¢23 per litre and petrol round GH¢17 at GOIL stations in November 2022.
A pointy cedi depreciation and the fast depletion of overseas reserves pressured the federal government and the Financial institution of Ghana to attempt an alternate technique: use gold, not {dollars}, to buy petroleum merchandise from the worldwide market.
The logic behind the programme was simple. Ghana wanted a workaround to its greenback scarcity that wouldn’t additional drain the Financial institution of Ghana’s reserves or worsen forex depreciation.
The objective was to ease strain on the cedi by preserving scarce overseas change reserves.
Ghana spends about $400 million every month importing gas, making it a significant driver of greenback demand.
Lowering that strain, even partially, was central to the programme’s logic.
The Financial institution had already launched a home gold buy programme in June 2021, partnering with the then Treasured Minerals Advertising Firm (PMMC), now rebranded as GoldBOD, to purchase gold dore from native miners in cedis and refine it overseas for Ghana’s official reserves.
The goal on the time was to double Ghana’s gold reserves inside 5 years, then standing at 8.74 tonnes.
That gold stockpile now exceeds 32 tonnes, almost quadrupling in beneath 4 years, in keeping with central financial institution knowledge.
The home gold buy programme was later expanded to incorporate the Gold for Oil framework
The Financial institution, by way of PMMC, purchased dore in cedis from miners, handed it to a “gold dealer”, and had it offered internationally.
The dealer offered the gold for U.S. {dollars} and deposited the proceeds straight into the Financial institution’s offshore (nostro) accounts. These funds had been used to buy petroleum merchandise.
The gas was delivered to Ghana, however the {dollars} used to purchase it remained abroad. In consequence, the native financial system noticed no direct injection of overseas forex.
Notably, your entire association was by no means subjected to parliamentary oversight. The ruling authorities argued on the time that the Gold for Oil programme was not an govt coverage however a central financial institution initiative, and due to this fact didn’t require parliamentary approval.
The factors for choosing these gold brokers, the charges paid, and the variety of intermediaries concerned haven’t been publicly disclosed.
The cedi did stabilise within the months after G4O’s launch, and gas costs fell.
Whereas it’s arduous to isolate the programme’s direct influence from that of the IMF deal signed in Could 2023, the decreased greenback demand from oil importers probably contributed to easing change fee strain.
By November 2023 (9 months in) then-Finance Minister Ken Ofori-Atta instructed Parliament through the 2024 funds presentation that G4O accounted for round 30% of petroleum imports.
No main updates adopted till the discharge of the Financial institution’s 2024 monetary report.
The Financial institution attributes a lot of the GH¢2.1 billion loss to overseas change losses.
However key particulars stay lacking: the amount of gold acquired, the gas equipped, the commissions paid, the intermediaries concerned, and the broader influence of the programme.
With over GH₵2.1 billion in reported losses and little transparency about the way it was run, Gold for Oil has ended as a pricey intervention.
It could have introduced non permanent overseas change aid and cheaper gas, nevertheless it in the end left a deep gap within the Financial institution of Ghana’s books.
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