The Ghana government will soon implement a new policy which will allow gold to be used to buy oil products instead of the US dollar from the reserves.
The barter of sustainably mined gold for oil is expected to be fully operational by the end of the first quarter of 2023.
Vice President Bawumia said “If we implement it as envisioned, it will fundamentally change our balance of payments and significantly reduce the persistent depreciation of our currency with its associated increases in fuel, electricity, water, transport, and food prices.
This is because the exchange rate (spot or forward) will no longer directly enter the formula for the determination of fuel or utility prices since all the domestic sellers of fuel will no longer need foreign exchange to import oil products.”
He explained that the demand for foreign exchange by oil importers in the face of dwindling foreign exchange reserves results in the depreciation of the cedi and increases in the cost of living with higher prices for fuel, transportation, utilities, etc.
According to him, the barter of gold for oil which represents a major structural change will help address the challenges.
He therefore thanked the Ministers for Lands and Natural Resources, Energy, and Finance, Precious Minerals Marketing Company, The Ghana Chamber of Mines and the Governor of the Bank of Ghana for their supportive work on this new policy.