Ghana Suspends Gold-for-Oil Scheme

March 4, 2025

(3 Minutes Read)

The previous government, which Mahama convincingly defeated in the December elections, introduced the gold-for-oil program as a strategy to counter currency fluctuations. Under this scheme, the central bank purchased gold in local currency and used it to barter or buy oil.

Ghana’s newly appointed central bank governor has suspended the country’s gold-for-oil program, expressing confidence in the stability of the cedi after last year’s volatility.

Interest rates currently stand at 27 per cent, while inflation eased to 23.5 percent in January. Asiama believes that improved monetary and fiscal policy coordination will help curb inflationary pressures as the nation moves beyond the economic turmoil caused by its 2022 debt default. Ghana, Africa’s largest gold producer, secured a US$3 billion bailout from the International Monetary Fund (IMF) and underwent a debt restructuring process following its default.

Having depreciated by 19 percent against the US dollar in 2023, the cedi is expected to avoid the “extreme volatilities” experienced in recent months, according to Asiama.

Ghana’s oil import bill amounted to USD 4.5 billion in 2024. By September of that year, the central bank had acquired 65.4 tonnes of gold, with 30.5 tonnes added to its foreign reserves by year-end. Moving forward, Asiama suggested that the central bank might withdraw from gold procurement, transferring responsibilities to a soon-to-be-established Gold Board.