The Domestic Gold Purchase Program was designed to make operational losses to maximize the country's forex - Senyo Hosi
Economic analyst Senyo Hosi says Ghana must address the economic incentives surrounding its domestic gold purchase program if it wants to stop gold smuggling and maximize foreign exchange earnings.
According to him, the program was designed to make operational losses while using Ghana’s gold resources to generate foreign exchange. He argues that enforcement alone will not stop gold smuggling if aggregators can obtain better returns outside the official system.
A key concern, he says, is the gap between the Bank of Ghana’s official exchange rate and the parallel-market rate. Closing this gap, he argues, is essential to making it commercially attractive for aggregators to sell their gold through official channels.
The financial cost of Ghana’s gold-related programs has been significant. Available Bank of Ghana figures show combined losses from the Gold-for-Oil (G4O) and Gold-for-Reserves (G4R) programs of approximately:
- 2022: GH¢74.4 million
- 2023: GH¢1.37 billion
- 2024: GH¢5.66 billion
- 2025: GH¢9.05 billion
This brings the cumulative reported loss to about GH¢16.16 billion over the four-year period.
The Gold-for-Oil program alone recorded losses of about GH¢2.42 billion between 2022 and 2025, while Gold-for-Reserves accounted for approximately GH¢13.74 billion.
Mr. Hosi’s position is that Ghana must therefore combine stronger enforcement with better market incentives. If licensed aggregators are offered competitive pricing and exchange-rate arrangements, while smuggling networks face effective enforcement, more gold could remain within the formal economy.
The broader challenge for government is to ensure that Ghana's gold wealth does not simply increase the volume of gold purchased but actually translates into sustainable foreign-exchange gains and stronger reserves without imposing excessive losses on the public purse.