Ghana’s ambitious strategy of using its gold wealth to stabilise the economy came at a heavy financial cost in 2025, with the Bank of Ghana (BoG) recording losses exceeding $1.7 billion—equivalent to 1.5% of Gross Domestic Product (GDP)—largely from trading dore gold on behalf of the newly established Ghana Gold Board (GoldBod).
An International Monetary Fund (IMF) assessment, however, says the costly programme simultaneously delivered some of Ghana’s strongest macroeconomic gains in recent years by rebuilding foreign exchange reserves, strengthening the cedi, improving the current account and restoring confidence in the economy.
The IMF notes that the challenge for policymakers now is to preserve those gains while preventing the huge financial losses experienced under the Domestic Gold Purchase Programme (DGPP) from recurring under GoldBod.
Losses linked to dore gold trading
The IMF explains that the losses arose mainly from BoG’s trading of dore gold—unrefined gold purchased largely from artisanal and small-scale miners under the Gold for Reserves initiative on behalf of GoldBod.
By the end of 2025, the DGPP had expanded rapidly, making the central bank the intermediary for virtually all artisanal and small-scale gold exports.
The programme purchased and exported approximately 104 tonnes of artisanal gold worth $10.9 billion, representing about 9.5% of Ghana’s GDP, while also handling $1.26 billion worth of bullion from the large-scale mining sector.
Despite the enormous trading volumes, the IMF estimates that losses on dore gold transactions amounted to about 17% of the value of the gold sold by the Bank of Ghana.
According to the report, the losses were driven by several factors, including high assay and service fees paid to GoldBod, discounts granted to exporters and, most importantly, foreign exchange losses arising from the difference between the higher forex bureau exchange rate used to purchase gold and the official BoG reference rate used for accounting purposes.
The IMF further observes that Ghana’s artisanal gold purchase prices ranked among the highest in the region, significantly reducing the programme’s profitability.
Programme born out of economic crisis
The DGPP was introduced in 2021 when Ghana faced severe balance of payments pressures, rapidly declining foreign exchange reserves and a worsening debt crisis.
Its objectives were to formalise Ghana’s artisanal and small-scale mining sector, reduce widespread gold smuggling, strengthen foreign exchange reserves and improve macroeconomic stability.
By 2025, the programme had become the country’s principal mechanism for mobilising artisanal gold production for official exports.
Gold transformed external position
Despite the heavy financial losses, the IMF concludes that the programme made a significant contribution to Ghana’s macroeconomic recovery.
Gold now accounts for more than half of Ghana’s total exports, compared with about 20% in 2021, reflecting the rapid expansion of formal gold exports following implementation of the DGPP and complementary policy reforms.
The formalisation of artisanal exports, combined with favourable international gold prices, substantially improved Ghana’s trade balance and current account.
The report indicates that gross international reserves increased eightfold to $11.9 billion by the end of 2025, representing approximately four months of import cover and significantly exceeding programme targets.
Total inflows through the Domestic Gold Purchase Programme reached $12.7 billion in 2025, compared with $1.7 billion in 2023.
The stronger reserve position enabled BoG to conduct approximately $10.6 billion in foreign exchange sales during 2025 through its new transparent auction framework, helping deepen market liquidity and contributing to a 41% nominal appreciation of the cedi during the year.
Smuggling reforms
A major component of the strategy involved reforms aimed at reducing gold smuggling.
The IMF estimates that between 2019 and 2024, approximately 229 tonnes of artisanal gold worth $11.4 billion failed to appear in Ghana’s official trade statistics because of smuggling and informal exports.
To reverse the trend, Government abolished the 1.5% withholding tax on unprocessed precious minerals in 2025 to encourage miners to sell through official channels.
The establishment of GoldBod as the sole purchaser of artisanal gold was intended to consolidate these gains by internalising previously unrecorded exports and improving foreign exchange inflows.
Operations transferred to GoldBod
The IMF notes that from July 1, 2026, all DGPP operations and associated costs were transferred from BoG to GoldBod.
The transfer shifts the financial burden from the central bank to Government while enhancing fiscal transparency and reducing quasi-fiscal operations by BoG.
Early results indicate some operational improvements.
According to the report, the cost of purchasing gold declined from 14.5% of gold purchases in 2025 to 11.4% during the first quarter of 2026, reflecting lower assay charges, reduced logistics costs and a narrowing of the exchange rate spread used in transactions.
Government’s longer-term objective is to reduce operating costs further to around five per cent of gold purchases.
Responsible sourcing
The IMF also highlights GoldBod’s commitment to implementing internationally recognised responsible sourcing standards.
The report states that GoldBod intends to comply with OECD and London Bullion Market Association (LBMA) guidelines through enhanced due diligence, supplier onboarding, traceability systems and stronger Know Your Customer (KYC) and Anti-Money Laundering (AML) controls.
These reforms are expected to reduce illicit financial flows, improve transparency, limit environmental damage associated with illegal mining and strengthen Ghana’s access to premium international gold markets.
Risks remain
Despite the programme’s success in stabilising the external sector, the IMF warns that Ghana’s increasing dependence on gold also exposes the economy to significant risks.
A sharp fall in international gold prices would weaken export earnings, reduce economic growth, place pressure on the exchange rate and further weaken BoG’s balance sheet.
The report estimates that a 30% decline in gold prices could reduce Ghana’s real GDP growth by between 0.73 and 1.55 percentage points, while a 45% decline could lower growth by between 1.10 and 2.33 percentage points over the following year.
The IMF also cautions that Government’s target of increasing reserves to cover 15 months of imports by 2028 would entail substantial opportunity costs and significantly higher sterilisation expenses.
Sterilisation costs, it estimates, could rise to around three per cent of GDP, compared with approximately one per cent of GDP in 2025.
Banking sector resilient
While the broader economy has become more exposed to gold price movements, the IMF concludes that Ghana’s banking sector remains broadly resilient.
Mining-related loans account for only 5.3% of banks’ loan portfolios, while the sector’s non-performing loan ratio stands at 10.4%, below the industry average of 18.1% recorded in March 2026.
Stress tests conducted by the IMF indicate that even under severe gold price shocks, the banking system would remain above the minimum regulatory capital requirement, although some domestically owned banks with weaker capital positions could face increased pressure.
Balancing gains and costs
The IMF concludes that the DGPP ultimately delivered significant macroeconomic benefits by rebuilding reserves, strengthening the cedi, improving the current account and supporting debt sustainability.
However, those gains came at the cost of more than $1.7 billion in trading losses, weaker Bank of Ghana equity and increased fiscal risks.
According to the Fund, transferring the programme to GoldBod, reducing procurement costs, enforcing responsible sourcing standards and carefully managing purchase prices and foreign exchange spreads will be critical if Ghana is to preserve the economic gains from its gold strategy without repeating the costly experience of 2025.
