For much of 2025, the economic narrative was one of remarkable stabilisation. Inflation fell sharply, the cedi appreciated strongly, fiscal conditions improved and international reserves increased. The Bank of Ghana’s own data, however, show that the external-sector environment has become more complicated in 2026. By September, the cedi had depreciated by 9.5 percent in real bilateral terms against the US dollar on a year-to-date basis, while the nominal trade-weighted cedi had also weakened. At the same time thereserve position has become more volatile – declining from5.7 months of import cover at the beginning of the year to 4.2 months by August, a total loss of $3.09 billion.
That raises the question: if the macroeconomic fundamentals have improved so dramatically, why does Ghana’s external position remain so dependent on the continuous flow of gold-derived foreign exchange? And why, despite the heavy pumping of FX (over $12 billion) in market interventions the cedi is fast depreciating and gross international reserves (GIR) declining at the pace we are seeing now?
The main macro-fiscal anchor and its architecture
On the back of the 2022 crisis, Ghana began the Domestic Gold Purchase Programme (DGPP) – a policy described by some experts as the Bawumia Doctrine (BD). The economic logic was straightforward. Ghana purchases gold from domestic producers in cedis. The gold is exported or converted into reserves. The resulting foreign exchange can then support the foreign-exchange market and strengthen the country’s external position.
Until recently, the Domestic Gold Purchase Programme (DGPP) relied heavily on the balance sheet of the Bank of Ghana. That model helped Ghana accumulate gold and foreign-exchange reserves and contributed to exchange-rate stabilisation. According to the IMF, the DGPP facilitated the export of US$10.9 billion of artisanal gold in 2025 alone, equivalent to about 9.5 percent of GDP. The programme coincided with a period of significant macroeconomic stabilisation and contributed to reserve accumulation. But it also generated substantial financial losses. The IMF estimates that the DGPP generated losses of approximately GH¢22 billion, equivalent to 1.5 percent of GDP in 2025. The lesson was not that Ghana should abandon gold. Rather, it was that the central bank should not indefinitely carry the financial risks of what was essentially a quasi-fiscal commercial activity.
From July 2026, the architecture changed. GoldBod assumed responsibility for domestic gold purchases, while the Bank of Ghana exited the quasi-fiscal financing of the programme. GoldBod increasingly relies on commercial banks and private off-takers for financing. This is potentially an important institutional improvement because it separates monetary policy from commercial gold-purchasing operations. But it also creates a new vulnerability: financing capacity.
The IMF describes the reform as eliminating the BoG’sexposure to incremental quasi-fiscal risks associated with gold purchases. This new policy architecture has fundamentally changed the way Ghana uses gold to support foreign-exchange generation and reserve accumulation. The transition deserves closer attention because it represents more than an institutional change at GoldBod. It is a redesign of part of Ghana’s external-sector architecture.
The central question is simple: Can Ghana’s new gold-to-FX model generate foreign exchange reliably enough to support the cedi and build reserves without recreating the financial risks of the old system?
The new Gold–FX–Reserve triangle
GoldBod now sits at the centre of an increasingly important transmission mechanism:
Domestic gold → GoldBod purchases → gold exports → foreign exchange → commercial banks/reserves → cedi stability.
If the system works efficiently, gold purchases generate exports, exports generate dollars, and those dollars provide liquidity to the foreign-exchange market while strengthening international reserves. The August 2026 figures suggest that the new model has considerable potential. GoldBod reported generating US$1.315 billion in FX during its first full month under the new financing model. About US$668 million was sold directly to commercial banks, while approximately US$647 million was reported to have been made available to the Bank of Ghana for reserve accumulation.
These figures mean it would be premature to conclude that the new model is failing. But one successful month is not the same as a fully tested system. The real question is whether the model can mobilise financing consistently and at scale when market conditions become more difficult.
The real vulnerability: dependence
GoldBod is becoming more than a gold-sector institution.Because it is now supplying substantial FX to commercial banks and contributing directly to reserve accumulation, its operational performance has implications for the wider foreign-exchange market. That creates a potential institutional dependency. If financing becomes constrained, gold production falls, export shipments are disrupted or the cost of financing rises, the consequences could extend beyond GoldBod itself.
This is why recent irregularities in gold export flows deserve attention. They do not, by themselves, demonstrate that the new model is failing. Rather, they illustrate how interconnected the new architecture has become. The system must therefore be judged by its resilience, not simply by its performance during favourable conditions. What is the gold-backed stability resilience strategy?
Reserves: the bigger question
It is also important not to overstate the reserve story. Ghana’s reserves have not simply fallen continuously. The more important issue is the durability of reserve accumulation.Ghana has adopted an ambitious reserve strategy, with gold playing a central role. The objective is to build substantial international reserves over the medium term. But reserve accumulation and external resilience are not identical.
Reserve accumulation asks: How many dollars does Ghana have? External resilience asks:
How reliably can Ghana generate dollars when conditions deteriorate?
The second question is ultimately more important. Gold can provide a powerful reserve anchor, but it remains a commodity. A country whose foreign-exchange position depends heavily on gold remains exposed to commodity prices, production volumes, export arrangements and financing conditions.
The hidden fiscal question
There is another issue that deserves attention. Moving gold-purchase financing away from the Bank of Ghana does not make the economic cost disappear. It changes where that cost is carried. Under the old system, the cost was reflected partly through the central bank’s balance sheet. Under the new arrangement, the government and GoldBod assume greater responsibility.
This can be institutionally healthier because fiscal costs should be visible and subject to parliamentary scrutiny. But Ghana must ensure that fiscal risks are not merely transferred from the central bank to another public institution. The key questions should therefore include:
How much does GoldBod pay for gold? What are its financing costs? What are its margins? How much does it spend on operations and exports? How much FX does it generate? And ultimately, who bears the risk if the economics of the programme deteriorate?
From reserve accumulation to external resilience
The deeper lesson goes beyond GoldBod. Ghana needs an external-sector strategy that combines gold with broader sources of foreign exchange: manufacturing, agriculture and agro-processing, tourism, digital services, traditional exports, remittances and other internationally competitive services.Gold can strengthen the balance sheet. It cannot by itself diversify the productive structure of the economy.
The ultimate objective should therefore be to build an economy capable of generating foreign exchange from multiple sources, maintaining adequate reserves and absorbing external shocks without repeatedly placing extraordinary pressure on either the Bank of Ghana or the sovereign balance sheet.
The real test
The new GoldBod model has demonstrated that market-based financing can generate substantial FX. That is an important development. But the real test will come when conditions are less favourable. What happens if gold prices fall? If commercial-bank liquidity tightens? If private off-takers reduce financing? If production declines? If the import bill rises sharply?
Can GoldBod continue financing purchases? Can commercial banks continue receiving sufficient FX? Can the Bank of Ghana maintain adequate reserves? And can all of this happen without recreating the quasi-fiscal risks that the July reform was intended to eliminate? These questions will determine whether Ghana has merely changed the institutional location of its gold strategy or genuinely strengthened its external-sector architecture.
BY GIDEON BOAKO
