GoldBod should be judged by strategic objectives – Analyst

Financial Analyst John Kyei has urged stakeholders to assess the performance of the Ghana Gold Board (GoldBod) based on its strategic objectives rather than solely on accounting profits or losses.

His comments come amid ongoing discussions over the reported GH¢22 billion loss associated with the Bank of Ghana’s Domestic Gold Purchase Programme.

Speaking on Business Breakfast on Zed, Mr. Kyei said GoldBod was established to perform specific strategic functions, including supporting the accumulation of foreign exchange reserves and improving the country’s access to foreign exchange.

He argued that these objectives should form a key part of any assessment of the institution’s performance.

“But if we don’t want to do that and want to make them a strategic agency to cater for our accumulation of reserves and also our forex needs, then we should not be too much concerned about the losses,” he said.

According to him, the nature of GoldBod’s operations means fluctuations in gold prices can significantly affect the accounting value of its holdings.

“If the business always has to be buying whether price is high or low, and then the gold price swing, you know it will always affect the way you value gold at the end, and it will create massive losses,” he explained.

Mr. Kyei said GoldBod’s performance should instead be measured against indicators such as the country’s foreign exchange reserves and import cover.

“So your scorecard should be one. We have enough forex. You can see the trajectory. The import cover keeps increasing,” he said.

He added that rising reserves would also indicate progress towards one of GoldBod’s key strategic objectives.

“If we also see our reserves also increasing, then it means that we are getting there,” he stated.

Mr. Kyei further identified value addition to Ghana’s gold resources as another area that should be considered when assessing GoldBod.

“If we are also seeing the value addition to gold in this country, and we have started exporting some to other countries and the rest, then clearly GoldBod is performing their functions,” he said.

The Financial Analyst also said GoldBod’s role in formalising the gold trading chain should be assessed alongside efforts to tackle illegal mining.

He noted that GoldBod’s ability to trace gold purchases could help determine whether gold entering the formal market is sourced from properly regulated mining operations.

“If we see that now, as they said, they are tracing every gold they buy, and we are seeing the activities of illegal miners dwindling, going down, then we will see that indeed GoldBod is achieving its objectives,” he said.

Mr. Kyei therefore maintained that the institution’s broader policy outcomes should take precedence over a narrow assessment based on accounting results.

“And this should be the scorecard for them, not the accounting profit or losses,” he stressed.

His comments add to the broader debate over how GoldBod and the Domestic Gold Purchase Programme should be evaluated, particularly given the programme’s role in Ghana’s foreign exchange and reserve accumulation strategy.