BY Daniel Bampoe
The gold sector, long regarded as a pillar of national revenue and foreign exchange stability, is now at the centre of an intensifying public controversy following revelations that the country’s gold trading framework may have contributed to losses estimated at $214 million.
At the heart of the storm is the Ghana Gold Board (GoldBod) created by President John Dramani Mahama in January 2025, its operational structure, and the role of a private firm, Bawa-Rock Limited, in the state’s gold purchasing arrangements.
What began as a technocratic policy intervention to stabilise the cedi and strengthen foreign reserves has evolved into a national debate over governance, transparency, and the true cost of state-led market interventions.
From Reform To Red Flags
The Gold for Reserves (G4R) programme was introduced as part of Ghana’s broader economic stabilisation strategy. Built on the earlier Gold for Oil (G4O) initiative, the programme aimed to reduce pressure on foreign exchange reserves by using domestically sourced gold to support imports, strengthen reserves, and stabilise the cedi.
Under this framework, the Bank of Ghana (BoG), working through the Precious Minerals Marketing Company—now reconstituted as the Ghana Gold Board (GoldBod)—purchased gold from artisanal and small-scale miners.
The gold was either refined for reserves or sold on international market to generate foreign exchange.
However, the International Monetary Fund (IMF), in its fifth review of the Extended Credit Facility programme, disclosed that the model had resulted in losses amounting to approximately $214 million by September 2025.
These losses, the IMF noted, stemmed largely from trading inefficiencies, pricing mismatches, and the structure of the transactions themselves.
How The Losses Occurred
According to data cited by the IMF and corroborated by the Bank of Ghana, the losses emerged from a fundamental mismatch in how gold was purchased and sold.
GoldBod bought gold from local miners at or near prevailing international prices—sometimes even at a premium—to discourage smuggling and ensure supply.
However, when the same gold was exported, it was sold at a discount due to refining costs, assay risks, and international market practices.
The result was a built-in loss on every transaction.
Compounding this problem were service charges and fees paid to GoldBod, including assay and handling fees, which further increased the financial burden on the central bank.
Between 2023 and 2025, these costs accumulated into billions of cedis, with the Bank of Ghana absorbing the losses to preserve macroeconomic stability.
The Rise Of GoldBod And The Bawa-Rock Question
While GoldBod recorded operational revenues, the financial strain was transferred almost entirely to the central bank.
This structure has raised questions about who truly benefitted from the arrangement.
Scrutiny has particularly focused on Bawa-Rock Limited, a company that reportedly became the sole aggregator authorised to purchase gold on behalf of the state.
According to critics, this effectively created a monopoly within a sector that traditionally relies on multiple actors to ensure price discovery and transparency.
Concerns have intensified following claims that Bawa-Rock holds dual roles—operating both as a government-appointed aggregator and as a self-financing trader.
Under such an arrangement, critics argue, the company could theoretically buy gold in one capacity and sell it in another, raising serious questions about conflict of interest, pricing integrity, and oversight.
The Minority in Parliament has demanded clarity on how Bawa-Rock was selected, the criteria used, and whether due diligence was conducted.
They have also questioned reports that the company’s headquarters operates under heavy security and that its ownership structure remains opaque.
A System Under Strain
Defenders of the current framework argue that the programme helped stabilise the cedi, boosted reserves, and prevented a deeper macroeconomic crisis at a time when global conditions were hostile.
Indeed, Ghana recorded over $10 billion in gold export inflows during the period, providing critical liquidity.
However, critics counter that stabilisation came at an unsustainable cost.
While the cedi stabilised and inflation slowed, the central bank absorbed billions in losses—an outcome they argue undermines the very purpose of prudent economic management.
The IMF has echoed these concerns, warning that the continuation of such a model could weaken the Central Bank balance sheet and compromise long-term monetary stability.
It has recommended structural reforms to ensure that trading risks are not borne by the central bank.
