Our economy would have collapsed without gold-for-oil programme – Bawumia

Flagbearer of the New Patriotic Party (NPP), Dr. Mahamudu Bawumia has said the success of the Gold-for-Oil programme cannot be overlooked.

Dr. Bawumia argued that without the policy, Ghana’s economy would have collapsed.

“Without the gold purchase program and the gold-for-oil programme, this economy would have collapsed,” he said during a media encounter on Sunday, August 25, 2024, held in Accra.

According to him, the ‘gold-for-oil’ policy has yielded a positive impact and has helped in the reduction of prices of petroleum products at the pumps.

He said locally, we’ve been able to buy 5 billion dollars worth of gold through the initiative, and that is why we have not witnessed a shortage in fuel commodities.

He promised to further institutionalise the program to make it far better than what it is today.

The Gold-for-Oil (G4O) programme was an initiative of the Government of Ghana to use the existing BOG Domestic Gold Purchase (DGP) program to provide import finance facilities to support the importation of petroleum products into Ghana.

It facilitates the exchange of gold for oil, offering a strategic approach to oil import transactions. Initiated by the Bank of Ghana (BoG) and Precious Minerals Marketing Company (PMMC), the program involves purchasing gold in cedis under a petroleum purchasing agreement.

A portion of this gold is then utilised to secure oil, leveraging the dual status of gold and oil as international reserves.

The BoG supplies the acquired oil to the Bulk Oil Storage and Transportation Company (BOST), which, in turn, certifies the oil’s specifications and signals the BOG to proceed with payment using the exchanged gold.

BOST sells these oil products to bulk distribution companies (BDCs) in cedis, enabling them to acquire products without the need for dollars.