Oforikrom Member of Parliament, Michael Aidoo, has questioned the financial risks associated with the Ghana Gold Board’s (GoldBod) operations, particularly as the institution takes on greater responsibility for the country’s gold purchasing activities.
His concerns follow the disclosure by the International Monetary Fund (IMF) that Ghana’s Domestic Gold Purchase Programme (DGPP) incurred losses exceeding US$1.7 billion.
The programme was initially financed through the Bank of Ghana (BoG), with GoldBod playing a central role in the purchase and sale of gold.
Micheal Aidoo argues that the development raises a fundamental question about accountability: if an institution is provided with public funds to buy and sell gold and the transactions result in losses, who should bear those losses?
According to the MP, the experience with the Domestic Gold Purchase Programme (DGPP) shows the potential danger of allowing losses from gold trading activities to eventually affect the balance sheet of the central bank.
He noted that the IMF has already raised concerns about the impact of the programme on the BoG’s financial position, describing the central bank’s involvement in such activities as quasi-fiscal operations that could undermine its monetary policy mandate.
Mr Aidoo said the transfer of the DGPP to GoldBod should therefore be accompanied by stronger financial controls and clear accountability mechanisms.
He questioned whether GoldBod would absorb any future losses from its trading operations or whether the financial burden could eventually be passed on to commercial banks or the government as the commercial banks will now finance GoldBod gold purchase.
The MP also raised concerns about the need for clear benchmarks for the margins and commissions applied to gold transactions.
He argued that without transparent pricing and risk-management mechanisms, the country could face another situation in which substantial losses are incurred before the public fully understands their impact.
He further challenged what he described as an attempt to separate GoldBod’s financial performance from the losses associated with the gold trade, arguing that the institution participated directly in the transactions that generated the reported losses.
He said Ghana must learn from the DGPP experience and ensure that future gold trading operations are conducted on commercially sound principles.
