KON Mad Over Sale Of Ghana’s Gold Reserves

A fresh controversy has emerged over Ghana’s reserve management strategy after the Minority Member of Parliament for Ofoase-Ayirebi, Kojo Oppong Nkrumah, criticised the Bank of Ghana (BoG) for selling part of the country’s gold reserves.

The legislator, who also serves as Ranking Member on Parliament’s Committee on Economy and Development, raised concerns following a briefing by the Governor of the central bank, Dr. Johnson Pandit Asiama, on Monday.

The Governor appeared before the committee to provide explanations on the central bank’s monetary policy actions, reserve management decisions, and the financial implications of stabilising the economy after the recent debt crisis.

In recent years, Ghana has significantly increased its gold reserves through the Domestic Gold Purchase Programme, an initiative introduced to strengthen the country’s external buffers and diversify its international reserve assets.

Prior to the introduction of the programme in 2021, the Bank of Ghana held approximately 8.7 tonnes of gold. Through continuous purchases from domestic producers, the central bank gradually increased its gold holdings to more than 40 tonnes by October 2025.

This expansion made gold one of the largest components of Ghana’s reserve portfolio. However, a sharp rise in global gold prices in 2025 significantly altered the structure of the reserves. Gold prices increased by about 62 percent between January and October of that year, pushing gold’s share of Ghana’s reserves to roughly 42 percent.

According to the central bank, this development created concerns about excessive concentration in a single asset class.

BoG Defends Portfolio Rebalancing

Addressing members of the committee, Governor Asiama defended the Bank’s decision to rebalance the reserve portfolio by converting part of its gold holdings into foreign exchange assets. He explained that the move did not represent a depletion of Ghana’s reserves, but rather an adjustment in their composition.

“Ghana’s gold reserves remain fully part of our international reserves; what changed was the composition of those reserves,” the Governor told lawmakers. Dr. Asiama noted that international reserve management guidelines generally recommend that about 20 percent of a country’s reserves be held in gold as part of a diversified portfolio.

He said Ghana’s exposure had risen to more than 40 percent, creating what he described as a concentration risk.

To address this, the central bank undertook what he described as a measured portfolio rebalancing, converting part of the gold holdings into foreign exchange assets to improve liquidity and ensure the reserves remain readily usable for stabilising the foreign exchange market and financing essential imports.

The Governor stressed that central banks typically manage reserves based on principles of safety, liquidity and diversification rather than speculation on short-term price movements.

“The foreign exchange obtained from the transaction remains fully invested as part of the international reserves and continues to generate returns,” he added.

Opposition Challenges Decision

Despite the explanation, Mr. Oppong Nkrumah strongly criticised the decision, arguing that the sale of about 18 tonnes of gold had resulted in a major opportunity cost for the country. According to him, the gold was sold at around $4,000 per ounce, while current global prices have risen to above $5,000 per ounce.

Based on this difference, he argued that Ghana had potentially forfeited about $1.3 billion in valuation gains. “The poor policy decision on portfolio rebalancing is what has led to the $1.3 billion loss on the sale of the 18 tonnes of gold,” he said after the committee meeting.

While acknowledging the importance of diversification in reserve management, the legislator maintained that alternative strategies could have been adopted to reduce concentration risk without selling the gold.

Dispute Over Price Forecasts

Mr. Oppong Nkrumah also disputed the Bank’s suggestion that the surge in gold prices could not have been anticipated. According to him, several global forecasts had already pointed to a likely rise in gold prices due to geopolitical tensions and broader economic uncertainties.

“As far as we are concerned, most forecasts suggested that gold prices were going to rise in the medium term because of uncertainties around the world,” he said. He, therefore, described the Bank of Ghana’s assertion that the price surge was unforeseeable as unacceptable.

The Ranking Member argued that had the central bank retained the gold instead of selling it, Ghana’s reserves would have recorded valuation gains estimated at $1.3 billion.

The legislator further revealed that during the committee meeting, the Bank of Ghana indicated that it had already conducted an assessment of the valuation gains associated with the transaction and promised to provide the analysis to Parliament.

However, he said this disclosure would not halt the parliamentary inquiry already requested by the Minority. Mr. Oppong Nkrumah also disclosed that the central bank confirmed to the committee that government approval was obtained before the gold sale was executed.

According to him, Parliament will examine who authorised the transaction and whether such a significant decision should have required parliamentary oversight.

“It is now turning out that they got approval from government before they sold it. We will be looking into who gave that approval for such a significant transaction without recourse to Parliament,” he said.

 

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