The Vice President and Flagbearer of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia, has revealed that the next NPP government will stabilise the Cedi through the gold purchase program.
He disclosed that the two policies that helped rescue the economy from catastrophe in the recent crisis are the Bank of Ghana’s domestic gold purchase program and the Gold for Oil (G4O) program.
“I am happy to say that the two policies that helped rescue the economy from catastrophe in the recent crisis were the Bank of Ghana’s domestic gold purchase program and the Gold For Oil (G4O) program. The pilot has worked for a number of companies, some of which wanted to forex to repatriate profits. We have, thus, found a solution to profit reparation problem without destabilising our local currency. This also brings major comfort to foreign investors operating in our country. I believe from the success of the pilot scheme, we can confidently say that we have found a solution to the age-old foreign exchange problem that successive governments have struggled to contain, and which invariably led to inflation and other macro-economic challenges,” he disclosed.
The NPP flagbearer noted that his government will completely institutionalise what he calls the Gold-for-Forex program even as the country intensifies efforts to transform the structure of the Ghanaian economy.
“Simply put, the domestic gold purchase program (DGPP) is a policy which allows the Bank of Ghana to boost its foreign exchange reserves by buying locally produced gold with cedis. Gold purchases from this program alone have amounted to $5 billion in the last couple of years. With Ghana’s unexplored gold reserves estimated at 5 billion ounces (and a market value today of $10 trillion dollars),” he emphasised.
Dr. Bawumia said his government will ramp up the gold purchase program to cover all major forex demands.
“Put simply, if for example a company wants dollars, we will take their cedis, buy gold, and give them dollars. In this situation, demand equals supply. The gold purchase program will, therefore, provide the anchor that our local currency has always lacked,” he disclosed.