Africa Policy Lens (APL) has projected that Ghana could incur financial loss of up to $1.2 billion due to a controversial gold divestment strategy.
This fiscal brouhaha stems from the Bank of Ghana’s decision to offload approximately 19.4 tonnes of national gold reserves during the latter half of 2025 at relatively lower market prices, and turn around to initiate a repurchasing scheme through the Ghana National Reserve Acceleration Programme (GANRAP) as global prices surge.
The discrepancy between the initial sale proceeds and the projected cost of rebuilding the reserves represents a significant blow to the nation’s macroeconomic stability.
“There is a need for a description of the transaction structure, indicating whether the gold was sold outright, swapped, leased, or subject to any buy-back clause. Such an outcome reflects a costly policy reversal where the state sold at one price only to buy back at a much higher price.”
Africa Policy Lens (APL)
The mechanics of this potential loss are rooted in mistimed market execution and a subsequent policy reversal that critics label as “reckless.”
According to data analyzed by the policy think tank, Africa Policy Lens (APL), the 19.4 tonnes (approximately 623,700 ounces) were sold when gold traded between $3,950 and $4,200 per ounce, fetching an estimated $2.55 billion.
However, with the onset of the Ghana National Reserve Acceleration Programme and market forecasts pushing gold toward the $5,500 to $6,000 range, the cost to replenish those same 19.4 tonnes is expected to climb to $3.4 billion or higher.
This creates a massive “buy-back” deficit that threatens to drain the state’s coffers at a time when fiscal prudence is paramount.
“Given the strategic importance of gold reserves to national macroeconomic stability, reserve management, and public accountability, I would be grateful if the Bank could provide clarification,” APL demanded through Right to Information request to the Bank of Ghana.
Economic Impact of BoG’s Decision
The economic impact of a $1.2 billion loss is profound, particularly for a developing economy grappling with debt servicing and infrastructure needs.
This amount is equivalent to nearly 2% of Ghana’s GDP, a sum that could have significantly bolstered the nation’s primary healthcare system or funded the completion of stalled energy projects.
By liquidating a “safe-haven” asset just before a major price rally, the central bank has essentially surrendered Ghana’s hedge against currency volatility.
Market analysts argue that the decision to divest was unnecessary because gold, unlike fiat currency, maintains intrinsic value during global inflationary periods; selling it during a bull market to “rebuild” later is an antithetical approach to traditional reserve management.
Transparency and Accountability
Furthermore, the lack of transparency surrounding the counterparties involved has raised red flags. APL formally invoked the Right to Information Act, 2019 (Act 989) to demand “full disclosure of the identities of purchasing entities involved in the transactions, including beneficial ownership.”
There are mounting concerns that local partners or specific “bullion banks and brokers” may have profited from the spread at the expense of the Ghanaian taxpayer.
If the divestment was not driven by an immediate liquidity crisis which the government has not declared, then the “policy rationale or strategic justification for undertaking the divestment at that particular time” remains economically indefensible.
Timing and Inappropriateness of the Transaction
The timing of the sale is particularly galling given that global indicators and World Gold Council projections were already signaling a march toward $5,000 per ounce.
As APL rightly points out, “the financial consequences of the buyback strategy could ultimately fall on taxpayers” because the government lacks the immediate liquid capital to repurchase the gold in one lump sum.
Instead, the state will be forced to acquire the metal incrementally as prices continue to peak, likely widening the $1.2 billion gap even further. This suggests a systemic failure in market timing analyses or, more worryingly, a disregard for long-term fiscal security in favor of short-term cash flow.
In its quest for accountability, the APL is seeking “confirmation of Board approval, including the specific date on which the Board sanctioned the divestment.”
The extractive sector requires stability and predictable governance; however, this “costly policy reversal” signals a volatility in decision-making that could deter future mining investment.
If Parliament was not notified of the decision to “divest part of the national gold reserves,” as the RTI request suggests, the transaction may also face legal challenges regarding its constitutionality.
Ultimately, the new Ghana National Reserve Acceleration Programme, while sounding progressive in name, appears to be an expensive attempt to fix a self-inflicted wound.
The “arithmetic changes dramatically” when a nation sells its most stable asset only to realize months later that it cannot afford to get it back.
As the Bank of Ghana prepares its response to these pointed inquiries, the public remains skeptical of a strategy that sells the family silver only to rent it back at a premium.
For a nation striving for economic sovereignty, this $1.2 billion error represents a masterclass in how not to manage a sovereign wealth resource.
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