The Bank of Ghana (BoG) has attributed a GH¢17.5 billion accounting loss associated with the 2025 Domestic Gold Purchase Programme (DGPP) to the sharp appreciation of the cedi, explaining that the amount does not represent an actual cash loss to the country.
The bank said the loss resulted from exchange-rate differences between the rates at which gold was purchased locally and the rate used to convert proceeds from gold exports into cedis for accounting purposes.
The Head of Gold at the Bank of Ghana, Paul Bleboo, made this known yesterday when the BoG and other officials of the bank appeared before the Economy and Development Committee of Parliament.
The BoG team was led by the Governor, Dr Johnson Pandit Asiama.
Mr Bleboo informed the committee that the DGPP generated approximately $10 billion in foreign exchange and added about 11 tonnes of physical gold to the country's reserves in 2025.
He said the total cost of running the programme was $21.89 billion, with exchange-rate differences accounting for the largest component.
Circumstances
Explaining the circumstances surrounding the loss, Mr Bleboo said gold was purchased on the local market at prevailing exchange rates before being exported and sold for foreign currency.
The proceeds were subsequently converted into cedis for accounting purposes, using the BoG's reference exchange rates, which are lower than the market rates, a process that could take an average of 10 days and expose the programme to significant exchange-rate movements.
"Now, in 2025, we experienced massive appreciation of the cedi, about 40 per cent," he told the committee.
He explained that when gold was purchased at an exchange rate of GH¢15 to the dollar, but the cedi appreciated to GH¢12 before the export proceeds were converted, the difference resulted in a substantial accounting loss.
"Assuming you buy gold today at the rate of, maybe, GH¢15 per dollar, and then you move that gold to sell, get the foreign exchange (FX), convert it into cedi, we can take an average of 10 days to complete that,” Mr Bleboo explained.
"Within that period, you can experience a very sharp appreciation of the cedi, assuming the cedi moved from GH¢15 to a dollar to about GH¢12 per dollar.
That is a huge accounting loss," he said.
Mr Bleboo stressed that the amount represented an accounting adjustment rather than an actual cash loss.
"So that is what is causing this, and that is for a chunk of the total cost, and it is an accounting loss and not a real loss," he said.
He put the exchange-rate-related component at approximately GH¢17.5 billion, explaining that the cost would not have arisen the same way if the foreign exchange proceeds had been retained in dollars instead of being converted into cedis for reporting purposes.
He said the BoG was required to use its reference exchange rates for accounting purposes, which were lower than the market rates at which the gold had initially been purchased.
"So, because of that, we have to use the BoG rates, which is a rate that is far lower than the rate at which we bought the gold from the market," Mr Bleboo explained.
Programme returns
Defending the programme's benefits, Mr Bleboo emphasised that the foreign exchange proceeds and the physical gold acquired represented two separate benefits of the programme.
He also outlined other cost components, including purity and trading adjustments, off-take discounts, GoldBod service fees, assay fees, refinery charges, as well as manufacturing and logistics expenses.
On purity adjustments, he explained that differences between local assay methods and those used by overseas refineries could result in variations in the measured gold content.
"The gold is normally bought in dore form. So when the gold is transported to an overseas refinery, it is refined, and then we have what we call purity losses," he explained.
He added that foreign refineries used fire assay, which could produce different results from the method employed locally.
"So, there is a provision around 0.7 to 0.8 per cent purity loss that is incurred during that period," he explained.
With off-take discounts, Mr Bleboo said the payments covered expenses incurred by buyers in taking delivery of the gold and exporting it, including transportation, insurance and refining.
He said the discount had been reduced from 1.3 per cent to one per cent in 2025, following negotiations to lower the programme's overall costs.
"Over time, we realised the total cost component, and then we tried to push for all these rates to be renegotiated," Mr Bleboo said.
