Franklin Cudjoe, Founding President of IMANI Africa, has issued a an assessment of Ghana’s recent gold-backed economic initiatives, offering high praise for state institutions while demanding transparency regarding millions of dollars in transactional losses.
In a statement reviewing the Gold-for-Oil and GoldBod programs, Mr. Cudjoe noted that the government appears to have made significant strides, demonstrating that valuable lessons have been learned from past economic missteps.
He commended the Bank of Ghana, the Ministry of Finance, and GoldBod for their coordination, suggesting that the programs have evolved into a more mature framework that avoids past systemic errors.
These institutions deserve commendation for managing the current system to ensure a steadier flow of resources, he stated.
However, he quickly added that a fiscal discrepancy of $214 million requires clarification, insisting that this figure must be classified as a trade or transactional loss, despite apparent hesitation from officials to label it as such.
The core issue lies in the currency conversion cycle, where the Bank of Ghana provides Cedis to GoldBod to purchase gold from local aggregators, which is then sold abroad for US Dollars, creating inherent transaction losses due to constant exchange rate fluctuations.
Criticising the current structure, Mr. Cudjoe noted that GoldBod’s view of itself as a mere intermediary does not erase the reality of the deficit.
He maintains that $214 million is a significant sum warranting full public accounting of the losses and identification of specific buyers.
Clarity on these losses is essential for integrity, and a detailed breakdown of the timeline and quantum of loss per buyer is necessary to minimise future risks and prevent potential manipulation of the system.
Mr. Cudjoe advised the Bank of Ghana to provide specific answers on the cause of the loss and measures to mitigate such occurrences in the future.
Read below his statement
Having followed the Gold-for-Oil and GoldBod programmes, it is clear significant lessons have been learned by the current government in order not to repeat past mistakes. And GoldBod, the Bank of Ghana and the Finance Ministry deserve enormous commendation.
However, it is clear the way the current GoldBod system is structured there would always be tranasction losses as a result of the conversion of dollars to cedis and vice versa in the purchase of gold. I can undersrand why GoldBod wouldn’t acknowledge that the losses should be classified as such on their books, because it thinks they are just playing an intermediate role between bank of Ghana and the aggregators of gold since it is the bank that provides the cedis for gold purchases and ultimately receives proceeds of gold sold abroad in dollars.
But they are losses, transactional or trade losses. $214m loss is large enough for us to understand how it occurred, the period it occurred and where they occurred ( as in with which buyers of our gold and the quantum of loss per buyer),- This helps in two ways- 1. In order to minimise them if they were genuinely incurred and to help prevent a gaming / rigging due to privileged information or as it is commonly called, insider information, regardless of whether the spot and onward sale price of gold are displayed by GoldBod. And l think the Bank of Ghana should provide answers to how the $214m loss happened and what they will do to miimise it in futuret transactions.
My worry though is that it had to take the IMF to receive this information and then publish for us to knock our heads discusing what name to call it. Edefu! Enye koraa. ! Ehii koraa ! Not good!
By: Rainbowradioonline.com/Ghana
