According to the Vice President of Ghana, the nation would receive its first shipment of oil under the gold-for-oil scheme in January 2023.
On December 22, 2022, Dr. Mahamudu Bawumia posted on Facebook, “I am happy to announce that the Government of Ghana has concluded the arrangements for the operationalisation of the ‘Gold for Oil’ program.
The first oil items covered by the policy will thus be supplied the following month (January 2023)
“My thanks to the Minister for Energy, Minister for Lands and Natural Resources, Governor of the Bank of Ghana, the Chamber of Mines, PMMC and BOST for their leadership in the operationalisation of the Government’s Gold for Oil Policy. God bless our homeland Ghana”, he said.
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For the past few weeks, the government has been developing a new strategy to purchase oil goods using gold stockpiles rather than US dollar reserves.
The action, which was previously stated by Dr. Bawumia, is intended to address declining foreign exchange reserves as well as the demand for dollars from oil importers, both of which are weakening the local cedi and driving up living expenses.
At the end of September 2022, Ghana’s gross international reserves were estimated to be about $6.6 billion, or less than three months’ worth of imports.
According to the government, it is less than the $9.7 billion it was at the end of the previous year.
The new policy “would fundamentally affect our balance of payments and drastically lessen the ongoing depreciation of our currency,” according to Dr. Bawumia, assuming it is implemented as scheduled for the first quarter of 2023.
Because local vendors would no longer require foreign exchange to import oil goods, using gold would prevent the exchange rate from having a direct influence on the cost of gasoline or utilities, he said.
“The barter of gold for oil represents a major structural change,” he added.
The proposed policy is uncommon.