By Adnan Adams Mohammed
Ghana’s aggressive push to assert state control over the small-scale gold trade has ignited a fierce ideological divide among top economic thinkers.
At the center of the dispute is whether a reported $1.7 billion loss under the Ghana Gold Board (GoldBod) represents an intolerable hit to public coffers or a necessary investment to defense-fund national currency stability.
The state-led purchasing framework, introduced to channel small-scale mining output directly into official reserves, faces dual pressures: celebrated on one side as a market-shaping success that starved illicit smuggling routes, and criticized on the other as a flawed intervention that shifted massive financial burdens onto the central bank.
A Price Worth Paying for Currency Stability?
Defending GoldBod’s financial record, Dr. Emmanuel Steve Asare Manteaw, Co-Chair of the Ghana Extractive Industries Transparency Initiative (GHEITI), argued that fixating on short-term balance sheet deficits misses the broader macroeconomic victory.
According to Dr. Manteaw, the $1.7 billion deficit should be understood as a operational setup cost necessary to break foreign cartels that previously controlled the local gold supply.
“We make it look like this is the first time Ghana is making losses in its gold purchase program,” Dr. Manteaw observed during an appearance on JoyNews’ PM Express. “I’ve looked at the data. In 2022, we made a loss. In 2023, 2024, and 2025, we’ve made losses all those years. Why didn’t that become a problem?”
“So if you had to incur a loss of $1.7 billion to bring in $10 billion, that for me shouldn’t be a problem… For me, they are transaction costs, and all the governments over the years have been incurring transaction costs.”
Dr. Manteaw explained that upon its inception, GoldBod was forced to buy gold at competitive forex-bureau rates to outbid foreign syndicates predominantly Chinese, Indian, and Turkish buyers who had long monopolized local supply lines by providing cash advances and machinery to small-scale miners. He maintained that the resulting foreign exchange liquidity has stabilized the cedi, lowered inflation, and built a foundation for broader economic initiatives, such as the proposed 24-hour economy.
Structural Flaws and Hidden Tax Costs
Taking a starkly different stance, economist Professor Godfred Alufar Bokpin warned against over-attributing currency performance to GoldBod, arguing that the policy’s current architecture carries severe hidden costs for Ghanaian taxpayers.
While acknowledging that GoldBod successfully squeezed gold smuggling, Prof. Bokpin insisted that broad economic stability remains the product of policy management by the Bank of Ghana and the Ministry of Finance, rather than commodity trading interventions.
“This whole domestic gold purchase arrangement for which Gold Board essentially became the face of it from 2025 has also come at a significant loss to us,” Prof. Bokpin warned. “If you adopt a holistic approach and look at the whole intervention we put in place, the losses actually exceed the $1.7 billion we are talking about here.”
Prof. Bokpin pointed to design flaws within the purchasing model and highlighted the state’s decision to scrap the 1.5% withholding tax on small-scale gold production to incentivize official declarations a move that deprived the treasury of vital revenue.
“You have all these losses sitting on the books of the Bank of Ghana. In addition to that, we had to abolish the 1.5% withholding tax,” he noted. “If you look at total gold exports from artisanal small-scale miners which exceed $10 billion the fiscal losses that could have gone to fund roads, schools, and infrastructure were given up.”
Unwinding the Deficit
Despite their conflicting interpretations of the program’s value, both analysts agreed that running billion-dollar operational gaps is unsustainable over the long term.
Prof. Bokpin noted that state authorities are already preparing an exit mechanism to restructure the program’s financial exposure.
“Government itself, together with the Gold Board and the Bank of Ghana, recognize that these losses are not sustainable going forward,” Prof. Bokpin stated. “As part of the exit plan, the government intends to reduce these losses from about 17% or 14.5% down to about 5% going forward.”
As Ghana navigates its post-recovery economic landscape, the battle over GoldBod highlights a critical trade-off: how much state revenue should be spent to secure foreign exchange reserves in a highly informal extractive economy.