Economist Professor Godfred Alufar Bokpin has cautioned against crediting the Ghana Gold Board (GoldBod) for Ghana’s recent macroeconomic stability.
According to him, GoldBod has played an important role in bringing gold-related foreign exchange into the formal economy. However, he says the broader gains in macroeconomic stability result from fiscal and monetary policy.
Prof. Bokpin said GoldBod deserves recognition for reducing gold smuggling and increasing the amount of foreign exchange retained in Ghana.
“You can see that the gap has narrowed significantly with the introduction of Gold Board. And I think that is a credit to Gold Board,” he said.
He noted that both the New Patriotic Party (NPP) and the National Democratic Congress (NDC) identified challenges surrounding illegal mining, gold production and the reporting of gold exports ahead of the 2024 elections.
The NPP proposed reducing the final withholding tax on gold exports from artisanal and small-scale mining to encourage declarations. The NDC, he said, opted to establish GoldBod as the main entity responsible for buying and exporting gold, particularly from artisanal and small-scale miners.
Prof. Bokpin said the GoldBod arrangement has helped bring foreign exchange into the country that may have previously been lost to smuggling.
However, he believes the programme has come with significant financial losses that must be considered when assessing its overall impact.
“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, has come at a significant loss,” he said.
He said there were flaws in the programme’s design that could have been avoided with better planning and expert input.
“They were design defects of the program,” he said.
Prof. Bokpin argued that macroeconomic stability cannot be attributed to GoldBod because that responsibility rests primarily with monetary and fiscal authorities.
“In fact, that is not the job of the Gold Board. Macroeconomic stability comes from essentially fiscal and monetary policy, which is the Bank of Ghana and all of that,” he said.
He said the benefits of GoldBod must therefore be assessed alongside the costs of implementing the programme.
Prof. Bokpin cited losses reported in connection with the domestic gold purchase programme, saying the overall cost could be higher than the figures currently being discussed.
“Now, we are talking about 22 billion Ghana cedis or 1.7 billion Ghana cedis. In fact, Evans, let me put this across, that 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,” he said.
He also pointed to the abolition of the 1.5% withholding tax on artisanal and small-scale gold production as another cost to the state.
“So, you have all these losses sitting on the books of the Bank of Ghana. Is that okay? In addition to that, we had to abolish the 1.5%,” he said.
Prof. Bokpin said the fiscal implications become significant when the value of gold exports from artisanal and small-scale miners is taken into account.
“If you look at the total gold exports from artisanal small-scale miners, which are more than $10 billion, is that okay? And you want to do the analysis in terms of the fiscal losses, which could have gone to our revenue envelope, probably to fund roads, schools, and infrastructure, we have to give up that one also,” he said.
Despite the concerns, Prof. Bokpin acknowledged the programme’s gains.
“I recognise the impact of Gold Board, and I celebrate the progress that they have made in terms of crowding in gold-related FX,” he said.
But he insisted that the substantial losses should not be overlooked.
“I think that if you look at the benefit in terms of the macroeconomic stability and all of that, I will say that the benefit is quite substantial, but we must also recognise the cost, the huge cost associated with implementing this intervention,” he said.
He said the government, GoldBod, and the Bank of Ghana have recognised that the losses are unsustainable.
“The reason I’m saying so is that the government itself, together with the Gold Board and the Bank of Ghana, recognise that these losses are not sustainable going forward,” he said.
Prof. Bokpin noted that an exit plan is being pursued to reduce the losses associated with the programme.
“You know that as part of the exit plan of the Bank of Ghana exiting this, there’s now an understanding where the government intends, through the Gold Board arrangement, to reduce these losses from about 17% or 14.5% to about 5% going forward,” he said.
