Associate Professor of Finance at Andrews University in the United States, Prof William Kwasi Peprah, has raised concerns about how Ghana intends to finance its aggressive reserve accumulation policy.
Speaking on Joy News’ PM Express on Monday, he said while he backs the idea of building reserves, the scale of the current target is worrying.
“I support the Reserve accumulation policy, but it’s too ambitious.” He singled out the proposed 51 per cent threshold as excessive.
According to him, the policy comes with clear trade-offs. “We all know there is an opportunity cost for taking this decision.”
For Prof Preprah, the key issue is funding. “The direct cost that probably may come with this is, where are we going to get the funds from to be able to buy the gold?”
He warned that allocating such large sums to gold purchases could crowd out pressing national priorities.
“That kind of money, that amount of money could have been used in meeting some developmental needs now.”
In his view, the strategy amounts to postponing immediate growth in exchange for long-term stability.
“But what we are doing as a country is to probably defer growth.” He clarified his point.
“Let me put it in that way, defer some, some bit of growth and safeguard our future.”
The finance professor’s comments frame the debate in stark fiscal terms. Accumulating reserves may strengthen buffers and boost confidence.
But the resources required must come from somewhere. That, he suggests, is the real policy tension.
His argument does not reject reserve building outright. Instead, it questions the scale and speed. The concern is sustainability.
If funds are diverted to gold purchases, government must decide which developmental projects are delayed or scaled down.
For Prof Preprah, the 51% target intensifies the strain. The larger the target, the greater the funding requirement. And the higher the opportunity cost.
The central question, as he posed it, remains unanswered. “Where are we going to get the funds from to be able to buy the gold?”
