A Senior Lecturer at the Business School of Accra Technical University, Dr Daniel Osabutey, has cautioned that weak governance, institutional inefficiencies and inadequate financial management could undermine the government’s policy requiring large-scale mining companies to sell 30 per cent of their gold output to the Ghana Gold Board (GoldBod).
According to the financial expert, although the initiative has the potential to strengthen Ghana’s foreign reserves and improve macroeconomic stability, its success will depend largely on transparency, accountability and effective institutional management.
The policy, introduced by the government, mandates large-scale mining firms to sell 30 per cent of their gold production to GoldBod as part of efforts to boost the country’s foreign reserves, support the cedi and maximise the economic benefits derived from Ghana’s mineral resources.
Dr Osabutey described the policy as one of the most significant reforms in Ghana’s mineral resource management in recent decades but warned that poor governance could erode public confidence and limit its intended impact.
He stressed that GoldBod would need to operate efficiently throughout the gold purchasing chain, including procurement, transportation, refining, quality assurance and reserve management, to ensure the policy delivers meaningful results.
Financing, he said, also remains a critical concern, noting that purchasing 30 per cent of the country’s gold production would require substantial and reliable liquidity. He warned that any delays in payments to mining companies could disrupt production, strain business operations and negatively affect investor confidence.
Dr Osabutey further observed that while the agreed 0.55 per cent discount on gold purchases appears commercially acceptable, compulsory domestic sales could still raise concerns among investors regarding commercial flexibility.
To safeguard the initiative, he called for GoldBod to uphold high standards of corporate governance through independent audits, transparent financial reporting and strong institutional oversight.
He also recommended sustained engagement with mining companies, coupled with investment in refining infrastructure, logistics and technical expertise to maximise value addition within the country.
Despite the challenges, Dr Osabutey maintained that the policy could significantly strengthen Ghana’s economy if implemented effectively. He noted that directing part of the country’s gold production into the Bank of Ghana’s reserves could improve investor confidence, strengthen Ghana’s external credit profile and provide a buffer against global economic shocks.
He added that expanding domestic gold refining capacity could create skilled jobs, attract investment and position Ghana as a regional gold refining hub, while conducting gold transactions in Ghana cedis could reduce demand for foreign currency and ease pressure on the foreign exchange market.
Dr Osabutey concluded that the success of the policy should not be measured solely by the amount of gold accumulated in the Bank of Ghana’s reserves but by its ability to support a stronger economy, a more stable cedi, increased industrialisation, improved investor confidence and better living standards for Ghanaians.
