Ghana’s central bank is standing by its controversial Gold for Oil (G4O) programme, portraying it as a vital economic lifeline despite racking up losses of GH¢2.14 billion.

First Deputy Governor Dr. Zakari Mumuni offered a robust defence at London’s C’NVERGE 2025 conference, calling the initiative a crucial tool that secured affordable fuel, bypassed volatile currency markets, and softened inflation driven by pump prices.

“In several countries, leveraging commodities has become integral to policy frameworks,” Dr. Mumuni stated, highlighting its role during supply chain chaos and market instability.

He urged seeing resources like gold not just as trade goods, but as strategic assets shaping economies and investor confidence. He directly credited G4O with easing transport costs, steadying the cedi, and contributing to a credit rating upgrade.

“This was a market-based solution that delivered tangible results during a turbulent period,” he asserted.

Operational from late 2022 until its halt in March 2025, the scheme exchanged 27.63 tonnes of Ghanaian gold for 1.95 million metric tonnes of petroleum products.

The Bank of Ghana maintains this shielded the economy from worse instability, justifying the cost through achieved macroeconomic stability, particularly on inflation.

Yet, the programme’s closure stemmed directly from those massive losses. Analysts point to global gold price swings, oil market volatility, and procurement issues as key drains.

They also highlight the significant opportunity cost – gold used for oil could have bolstered national reserves instead.

Critics remain deeply concerned. They argue the focus on short-term fuel price relief may have weakened Ghana’s buffer against future external shocks, especially if gold reserves were depleted faster than replenished.

For many, the fundamental question lingers: did the stability bought truly justify the steep fiscal price?

Adding weight to the scrutiny, the International Monetary Fund confirmed its ongoing Safeguards Assessment will now evaluate Ghana’s gold purchase and G4O programmes.

This review will specifically analyse the associated risks for the central bank and inform proposed amendments to the Bank of Ghana Act.