Introduction

Ghana’s Gold-for-Reserves (G4R) and Domestic Gold Purchase Programme (DGPP) have been celebrated as innovative strategies to strengthen Ghana’s reserves, reduce reliance on foreign exchange borrowing, and curb illicit gold exports.

At the heart of these initiatives is the Ghana Gold Board (GoldBod), established in 2025 to support the accumulation of gold reserves by the Bank of Ghana (BoG)—particularly from the artisanal and small-scale mining (ASM) sector. Through G4R and DGPP, the BoG achieved its 2028 international reserve coverage targets in 2025, three years ahead of schedule, signalling apparent operational success.

Yet this impressive achievement has come at a cost. Although GoldBod records profitability on its books, the Bank of Ghana has incurred significant financial losses—estimated at US$214 million in nine months—linked to the structure of GoldBod’s trading model. This raises the central question: Does GoldBod owe the BoG US$214 million, or has the BoG actually lost US$214 million?

Put simply, the Bank of Ghana has already recorded US$214 million in realised losses, while GoldBod also owes additional value for undelivered gold, according to GoldBod’s published December 2025 Trade Report. These realities coexist, creating a substantial financial sustainability challenge for Ghana’s central bank.

Operational Impact of GoldBod: Success Achieved at Structural Cost

GoldBod has undeniably delivered substantial operational gains. Its aggregation strategy enabled Ghana to rapidly build reserves, formalise gold-buying operations, license actors, channel financial flows through formal channels, and support currency stability. Gold now accounts for a significantly increased portion of Ghana’s reserves—an achievement unparalleled in recent history. GoldBod is profitable, primarily driven by service fees and operational charges associated with Bank of Ghana transactions. These include a 0.5% service fee, an assay charge of 0.258%, and price-setting authority, which at times includes seasonal bonuses designed to prevent smuggling or stimulate supply.

Industry stakeholders confirm that GoldBod offered price bonuses to its licensed aggregators ranging from GHs 50 per pound to GHs 200 for the supply of gold to GoldBod’s sole aggregator, Bawa-Rock Ltd. While the initial assumption was that the dip was driven by smuggling, the evidence suggests that seasonal factors played a significant role. This period coincided with Ghana’s minor rainy season, during which many Artisanal and Small-Scale Mining (ASM) operations reduce activity. As a result, gold output typically falls compared to the dry season.

However, this very structure that drives GoldBod’s profitability also shifts disproportionate financial risk directly onto the Bank of Ghana’s balance sheet.

Understanding the US$214 Million: Loss or Debt?

The much‑discussed US$214 million does not represent money GoldBod “owes” to BoG. Instead, it reflects losses already realised by the Bank of Ghana arising from pricing gaps, off‑taker charges, service fees, and market exposures incurred during gold trading. In other words, this money is gone; it is a sunk cost and a crystallised loss in the BoG’s financial statements.

Separately, GoldBod has underdelivered gold relative to BoG funding by over GH¢3.5 billion, according to the latest published trade report. This is not yet a realised loss, but it represents significant liquidity and delivery exposure. If gold prices fall before delivery, or if delivery fails altogether, BoG risks further losses. Thus, both realities coexist: the BoG has already incurred losses and remains exposed to additional risk.

Why BoG Is Absorbing Losses While GoldBod Profits

This paradox arises from structural flaws. GoldBod controls pricing (it sets prices it “desires” to buy gold) and has at times applied bonuses that increased BoG’s acquisition cost. GoldBod also charges an ad valorem tax of 0.5% in the form of service fees, despite being financed by the BoG. There are limited firm delivery timelines, and GoldBod effectively enjoys guaranteed margins while the central bank bears commodity price risk and operational exposure.

This creates a situation in which wealth is effectively transferred from the central bank to GoldBod, thereby undermining the BoG’s financial independence while strengthening GoldBod’s profitability.

Financial Sustainability Risks to BoG

GoldBod poses four principal risks to the Bank of Ghana:

a)Realised financial losses already incurred.
b)Liquidity risk arising from undelivered gold worth billions of cedis.
c)Commodity price exposure tied to the growing concentration of gold in reserves.
d)Governance and market distortion risks arising from BoG’s expanded operational role.

No central bank can sustainably absorb such risk without compromising its balance sheet resilience and policy independence. Should the Trade Continue? The answer is a BIG YES, but only under a radically restructured framework. GoldBod has proven valuable to Ghana’s reserve management strategy and macroeconomic stabilisation, but continuation must prioritise protecting the central bank from insolvency‑risk exposure.

Policy and Structural Solutions

One of the foremost priorities in addressing the financial risks associated with the Bank of Ghana’s involvement in gold trading should be to safeguard the central bank’s balance sheet. Under the 2025 national budget, the government explicitly allocated a cedi equivalent of US$279 million as a revolving fund for the Ghana Gold Board (GoldBod) to enable it to purchase and export gold from small-scale miners, thereby enhancing foreign exchange reserves and formalising the gold sector (Graphic). However, these budgeted funds have not been released, and the Bank of Ghana has, in practice, stepped in to pre-finance GoldBod’s operations, exposing it to significant financial losses and monetary financing concerns (MyJoyOnline).

To protect the BoG’s financial integrity and its ability to conduct monetary policy independently, losses arising from national strategic programmes, such as GoldBod, should be transparently recognised and charged to the national budget rather than absorbed by the central bank’s books. Releasing the budgeted US$279 million directly to GoldBod through the national budget would align financing with legislative intent, reduce the need for BoG balance-sheet support, and ensure that strategic gold purchases are financed in a manner that complies with IMF programme conditions and global central-banking best practices.

Secondly, GoldBod’s pricing model and fee structure must be rebalanced. Fees charged to the central bank should be reviewed, discretionary bonuses replaced with rational, transparent policy mechanisms, and the risk of monopoly pricing reduced. At most, a 0.5% charge by GoldBod, which will also include the Assay fees, will be preferable. The current total fees of 0.758% incurred by BoG on trading via GoldBod are pretty steep and unfair to the national kitty. Why is that fee too steep? Let me explain this further. The BoG is providing funds to GoldBod to purchase gold for Ghana. However, GoldBod sets the price of gold in the domestic market and, at times, adds an arbitrary bonus. It then aggregates the gold for the BoG. By aggregating alone, GoldBod charges a 0.5% service fee. Subsequently, GoldBod will charge the BoG an additional 0.258% to confirm the purity and weight of the gold it aggregated for the BoG.  That’s the layman’s way to explain what is happening currently.

Third, strict delivery discipline must be enforced. Pre‑financing caps should be imposed on the central bank when the need arises to finance GoldBod’s operations due to delays in releasing budgetary allocations. Delivery timelines must be enforced, penalties applied, and independent audits mandated. Performance guarantees must become standard in the BoG and GoldBod’s operations.

Fourth, to minimise risk, the BoG should consider engaging other Self-Finance Aggregators for the G4R and DGPP programmes. The GoldBod’s website currently lists 51 Self-Finance Aggregators (SFAs). GoldBod has been silent on the performance of these aggregators. Do we need to scrap the SFA licensing regime? Why is the regulator, GoldBod, the only entity aggregating Gold for BoG? The BoG can consider a 50% pre-finance for high-performing SFAs. They receive 100% payment upon delivery of the requested volume. This model could also incentivise local banks to participate in domestic gold purchase initiatives.

Finally, strategic clarity is needed. GoldBod must function as an aggregator and policy instrument, not as a profit‑maximising entity at the expense of the central bank. The BoG should gradually reduce direct exposure and restore normal market functions.

Conclusion

GoldBod represents one of Ghana’s most significant recent successes in reserve accumulation and macroeconomic stabilisation. However, its current operating structure imposes heavy and unsustainable financial burdens on the Bank of Ghana. The Bank has already incurred US$214 million in losses while remaining exposed to billions in additional delivery risk.
With the right reforms, Ghana does not need to choose between strategic gold accumulation and central bank financial stability. Both are achievable.

GoldBod can continue to power Ghana’s reserve engine—but only if policy restructuring ensures that success is not purchased at the expense of the very institution responsible for monetary stability.

“GoldBod functions like a high-performance engine that has successfully accelerated Ghana’s reserve vehicle to its destination years early; however, the engine is currently running at a high financial cost to the car’s battery (the BoG), requiring a shift to a more sustainable power source (the national budget) to avoid a long-term breakdown.”

By Gabriel Nomotsu Teye-Ali
Finance and Natural Resource Analyst
+233-240-268-668
teyeali@gmail.com