By Ralph Waldo Emerson
In the great republic of human affairs, where policy wrestles with both rigour and clarity, there arises from time to time a controversy that demands the soul’s unflinching gaze. Such is the present debate concerning the GoldBod—the state instrument by which Ghana seeks to gather the yellow metal from its artisanal miners and convert it into reserves for the stability of the Cedi. Many, even those versed in finance, have confessed confusion. They ask three plain questions:
How exactly did GoldBod incur losses?
Are those losses truly significant?
Do not the benefits of the Cedi’s newfound calm vastly outweigh any cost?
Let us, without philosophical digression, walk the straight path of numbers and reason.
I. The Origin of the Losses
The International Monetary Fund, that sober chronicler to whom the government confides its figures, reports that GoldBod purchased roughly five billion dollars’ worth of gold from small-scale and artisanal miners, then sold it onward to overseas buyers. It also acquired $2.6 billion from large-scale mines outside the program. In total, the Bank of Ghana has spent some ten billion dollars intervening in the foreign exchange market to steady the Cedi, while still holding reserves of approximately $11.4 billion, of which at least $3.58 billion is gold bullion (and perhaps as much as $5.3 billion at current spot prices).
The IMF calculates a loss of 4.28 percent—$214 million—on the artisanal gold leg alone. The cause is simple: GoldBod pays miners more in Cedis than it ultimately receives in dollars from foreign refiners.
Consider two real days.
On 10 December 2025, the London Bullion Market fixed pure gold at $4,196 per troy ounce. GoldBod’s posted price, converted through its official exchange rate and including the celebrated bonus of GH¢650 per Ghana pound of 23-carat gold, yielded a payment equivalent to $4,435 per pure ounce. Even before shipping, insurance, assay, and the necessary discount to hasty buyers in India and Dubai, GoldBod had already paid 5.71 percent above the world benchmark.
On 29 December, without the bonus the price would have been marginally profitable, but with the bonus the effective payment reached $4,381 per ounce against a world price of $4,325—a loss again of 1.30 percent.
The old market was a dispersed, competitive swarm of buyers and sellers who timed their transactions keenly and bore their own risks. GoldBod, by design, has become the sole buyer, obliged to purchase steadily at generous rates lest miners hoard or smuggle. On the selling side, raw doré bars must be discounted for transport, verification, and the risk borne by refiners who advance dollars quickly to meet the central bank’s urgent needs. Concentration of risk, once distributed among many hands, now rests upon few shoulders—and risk, like all natural forces, demands its compensation.
II. Are the Losses Significant?
If GoldBod traded upon its own finite capital, the answer would be swift and stern. The Ministry of Finance allocated $279 million as working capital in 2025, yet did not disburse it. Were that sum the only buffer, the recorded nine-month loss of $214 million implies an annual run-rate of roughly $285 million. The buffer would be exhausted in less than a year; half gone in six months. Even a policy institution, shielded by the state, would face severe stress.
We have seen the same drama enacted at Cocobod, another creature of public purpose. Its loss-to-turnover ratios, drawn from official reports, are markedly lower than GoldBod’s near-5 percent margin of loss. No government can long sustain such haemorrhage in an organ it must continually recapitalise. A single defaulting off-taker could amplify the wound grievously.
III. Do the Benefits Outweigh the Costs?
Here the ground grows subtler. No single cause governs the exchange rate; economists commonly list fifteen or more. Fiscal discipline, inflation, harvests, debt relief, interest rates—all have played their part in the Cedi’s remarkable calm, rising from 14.7 to the dollar at the end of 2024 to roughly 11.1 today—an appreciation near 25 percent.
Only half of the Bank of Ghana’s intervention dollars have come through GoldBod; the rest derive from large mines, cocoa, and official flows. Much of the gain owes to the extraordinary rise in gold prices—72 percent this year—which has swollen export earnings independently of any domestic program.
Careful reckoning suggests that soaring gold prices alone account for perhaps 8.4 percentage points of appreciation through the ordinary export channel. Of the remaining gain, GoldBod can claim at most half of the central bank’s intervention effect.
A generous estimate therefore attributes no more than three percentage points of the Cedi’s strengthening to GoldBod—equivalent to roughly $600 million in reduced import costs. This exceeds the $214 million loss thus far recorded, yet we must look deeper.
Every local gold purchase injects new Cedis into circulation. To prevent inflation, the central bank must sterilise this liquidity by borrowing it back through open-market operations—at a recurring interest cost that, on a $5 billion base, may reach GH¢11–13 billion annually. The full ledger trading losses, sterilization expense, and the vulnerability of multibillion-dollar gold reserves to a price collapse may render the program, at best, cost-neutral while gold remains exalted.
Should prices revert toward their long-run mean near $2,000 per ounce, the reserves would shrink catastrophically, and the obligation to continue purchases would force even greater monetary creation. The entire scheme is perilously pro-cyclical: it prospers in boom, but courts ruin in reversal.
Gold has become the true driver of Ghana’s fortunes. The nation would do well to cease dividing its fiscal vision into oil and non-oil, and instead see clearly the distinction between gold and all else.
Transparency is the soul’s demand upon every public endeavour. The more light we cast upon GoldBod, the better we shall steer when the winds shift as shift they inevitably will.
