A significant portion of the reported US$1.7 billion loss associated with the Bank of Ghana’s (BoG) Domestic Gold Purchase Programme involving the Ghana Gold Board (GoldBod) is attributable to accounting and valuation treatment rather than an actual loss to the economy, the Institute of Economic Affairs (IEA) has said.
Director of Research at the IEA, Professor Alexander Bilson-Darku, said the figure must first be properly disaggregated before conclusions could be drawn about the programme’s actual financial implications.
Speaking at the IEA’s assessment of the 2026 mid-year budget review in Accra on Wednesday, Prof. Bilson-Darku explained that the first two components of the reported loss represented payments made by the central bank to GoldBod for gold purchased and exported on behalf of the Bank of Ghana.
“The first two sources of the loss were money that the central bank paid to the GoldBod on behalf of buying and exporting the gold on its behalf. So they actually constitute revenue to the GoldBod. I don’t understand why somebody would call revenue as a loss,” he said.
He explained that although the payments appeared as a cost on the books of the Bank of Ghana, the corresponding amounts accrued as revenue to another state institution, meaning the transactions should not automatically be interpreted as a loss to the state as a whole.
“So from the Gold Board perspective, those two components of the loss are the ones. Okay? This is a cost to the central bank, who paid it to them,” he said.
‘Almost 90%’ valuation effect
Prof. Bilson-Darku identified the third component as the most significant element of the US$1.7 billion figure, saying it accounted for almost 90 per cent of the reported amount.
According to him, that component arose largely from the valuation method used by the Bank of Ghana in recording the transactions in its books.
“The third one, the most significant, the one that constitutes almost 90% of this loss, the 1.7 billion, was simply due to valuation technique,” he said.
He illustrated the issue using an exchange-rate scenario in which GoldBod purchased gold on behalf of the central bank at a particular cedi-to-dollar rate, after which the proceeds were converted into cedis for accounting purposes by the Bank of Ghana.
He said central banks use reference rates for accounting purposes, which may differ from prevailing foreign exchange market rates.
“So when this money comes in, the central bank needs to convert that into cedis in its books. And if it converts the dollars using lower rates, they could use higher rates; that would be reflected as a loss,” he explained.
Prof. Bilson-Darku consequently cautioned against treating the reported valuation difference as equivalent to a cash loss suffered by Ghana.
“So it is merely a book accounting issue but not a significant loss to the nation,” he stated.
‘Left hand giving to right hand’
The IEA research director said the interpretation of the first two components also required a broader assessment of the financial relationship between the Bank of Ghana and GoldBod, both of which are state institutions.
He said an amount recorded as a cost by the central bank could simultaneously appear as revenue or a gain on the books of GoldBod.
“And we need to also be extremely careful, especially in accounting and economics. You need to be very careful. The first two components of the loss that we talked about,” he said.
He explained that, from the perspective of the state as a whole, the transactions involved the transfer of funds between two government institutions.
“Actually, if you look deep into it, it is one government agency paying another government agency the same amount,” he said.
“To the government, its monetary authority, which is the central bank, has made dollars. To the government, its gold board has made a gain. Plus or minus, there’s no cost. It is left hand giving to the right hand,” he added.
Calls for clearer breakdown
The comments come amid heightened public and political scrutiny of the Domestic Gold Purchase Programme and the reported US$1.7 billion loss recorded in connection with the programme.
The debate has centred on whether the reported figure represents an actual financial loss to the state or reflects, to a significant extent, accounting treatment, valuation differences and transactions between public institutions.
Prof. Bilson-Darku’s assessment underscored the importance of breaking down the reported figure into its constituent components before drawing conclusions about its impact on public finances and the wider economy.
His analysis also highlights the distinction between a reported accounting loss and an actual cash or economic loss, particularly where transactions involve transfers between public institutions and where foreign-currency assets are converted for accounting purposes at different exchange rates.
