According to directives issued by Samuel A. Jinapor , according to Ghana’s Minister of Land and Natural Resources, large gold mining companies must “sell 20% of all gold refined in their refineries to the Bank of Ghana”. The gold-to-oil scheme is part of the Ghanaian government’s plan to stem a further decline in the country’s foreign exchange reserves.
Bank of Ghana uses Cedi to pay for gold
Following revelations that Ghana plans to use gold to buy petroleum products, Samuel A. Ginapol’s Minister for Land and Nature Resources announced on November 25 that from 2023, the large mining companies will “sell 20% of all gold refined in their refineries to the Bank of Ghana”. . Payments for gold are made using the local currency, the Cedi, at the “undiscounted spot price”.
The Bank of Ghana (BOG) and Precious Minerals Marketing Company (PMMC) are working with mining companies to: Compliance with Directives. Regarding Ghana’s so-called Community Mining Scheme (CMS), the government said it would have to “sell the gold output to the government through PMMC”.
To ensure compliance, Jinapor stipulated that “CMS mining licenses shall include a clause obliging the licensee to sell the mined gold to the government.” According to a directive issued by Jinapor, all licensed small-scale gold miners will be subject to conditions similar to those imposed on community mining schemes.
Ghana’s foreign reserves declining
The president said the decision will help preserve the country’s depleted foreign exchange reserves. He added:
The exchange of sustainably-mined gold for oil is one of the most significant economic policy changes in Ghana since independence. If implemented as envisioned, it will fundamentally change the balance of payments and significantly mitigate the continued depreciation of currencies as the prices of fuel, electricity, water, transport and food rise.
Ghana effectively tackles one of the key factors behind the rapid decline of the Cedi by reducing or eliminating the use of US dollars in importing petroleum products You can, he argued, Bawumia. As reported by Bitcoin.com News, Ghana’s currency has fallen sharply since early 2022 and has been named the world’s worst performing currency.
Ginapol’s directive to gold mining companies is framed as a channel to help “local gold smelters obtain gold supplies from PMMC to support their operations”, but social Some of Baumia’s supporters on media platforms have criticized the proposed money. • Four oil policy.
In response to the Vice President of Ghana’s post, Facebook user Naji Alhassan said: These are wind dressings to please the bourgeoisie. The best way is to own at least 50% of our gold and a gold smelter to refine it. Soon the bourgeoisie will dry up all the gold that the Bank of Ghana buys. We want realistic measures.
But some of Baumia’s supporters, such as Mohamed Hasir, want to stop “imperialists from using worthless papers to control, manipulate and destroy the economy.” He praised the move, which he claimed was
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