The Bank of Ghana (BoG) has affirmed that the government’s Gold for Oil policy is advancing as planned. This initiative was introduced to address Ghana’s dwindling foreign currency reserves and the rising demand for dollars by oil importers, which had been putting pressure on the Cedi and increasing the cost of living.
Speaking before the Public Accounts Committee of Parliament on Monday, August 12, the First Deputy Governor of the Bank of Ghana, Dr. Maxwell Opoku-Afari, provided an update on the policy. “The Gold for Oil programme is on track, and the risk associated with the separate account is mitigated because the Central Bank’s financial contribution to the programme is capped,” he explained. “It’s the receivables within that capped amount that continue to finance the programme.”
The Gold for Oil policy, as outlined by the government, allows the country to pay for imported oil products using gold, in a direct barter arrangement with gold purchased by the Central Bank. According to the government’s G40 Programme Framework dated February 3, 2023, payment for oil supply is conducted through two channels: barter trade or forex obtained from selling gold to a broker.
In the barter channel, oil suppliers who are willing to accept gold in exchange for petroleum products are provided with the equivalent volume of gold by the Bank of Ghana. In the broker channel, the BoG sells gold to a broker, who in turn provides the necessary forex to pay for the petroleum products.
