Gold-for-Oil will increase Ghana's wealth - Majority Leader

The Minister for Parliamentary Affairs and Majority Leader of Parliament, Osei Kyei-Mensah-Bonsu, has touted the government's God-for-Oil policy.

Speaking in an interview with Kumasi-based Otec FM, on Tuesday, which was monitored by GhanaWeb, the Majority Leader described the Gold-for-Oil policy as revolutionary and said that it will help make Ghana wealthier.

According to him, the policy will block the smuggling of gold out of Ghana and prevent the issue of mining companies selling gold to private entities without the consent of the government.

“The Gold-foil-Oil for policy is a very good policy. It will help us kill many birds with one stone. We have the Mining and Minerals Act which has a provision called the pre-emption provision. This provision says that all the gold that is mined in Ghana should be first sold to the government and if the government says it will not buy it, then it can be sold to private entities.

“But the issue is that most of the mining companies in Ghana, especially the small-scale mining companies, do not adhere to this provision. They sell the Gold to the Chinese, Indians and the like but the government gets nothing from it despite the fact that there are destroying our lands.

“Currently on our books, gold excavated in Ghana is worth almost 3 million ounces but if check the amount of gold that has actually been exported out of Ghana is between 7 and 8 million ounces. This policy is going to force mining companies to sell their gold to the government and it will force all of them to declare. So this will help us in a mightier way so that we get the right wealth from our resources,” he said.

The Majority Leader, who is also the Member of Parliament for Suame, also said that the Gold-for-Oil policy will also help reduce the rapid depreciation of the country’s currency, the Ghana cedi by taking out the foreign exchange needed to import oil products into Ghana.

Background:

Vice President Mahamudu Bawumia, in November 2022, announced the government’s plan to undertake the gold-for-oil initiative. The deal was hinged on buying oil products with Ghana’s gold instead of the US dollar.

Dr Bawumia, in a post shared on Facebook, explained that the usage of gold to purchase oil would address Ghana’s dwindling foreign reserves as well as reduce demand for US dollars by oil importers.

“It will fundamentally change our balance of payments and significantly reduce the persistent depreciation of our currency,” the vice president earlier wrote.

Under the policy, the government believes that using gold to purchase oil products would also bring stability to the exchange rate market and ensure domestic oil operators do not solely depend on foreign exchange to import products.

Watch the interview below:

You can also watch this episode of People & Places here:





IB/WA