Kofi Bentil, Senior Vice-President of IMANI Africa, has hailed the Ghana Gold Board (GoldBod) as the best approach the country has adopted to manage its gold resources. In an interview with JoyNews, Mr. Bentil emphasized that GoldBod is not perfect but represents a significant improvement over an earlier arrangement where the Bank of Ghana was directly involved in gold trading.
A Step in the Right Direction
The previous arrangement, under which the Bank of Ghana traded gold through GoldBod, created problems for the central bank. Mr. Bentil explained that the central bank, responsible for maintaining monetary and financial stability, was also carrying the risks associated with commercial gold trading. This structure led to losses being reflected on the Bank of Ghana's balance sheet, creating challenges for the institution.
Separating Risks and Rewards
Ghana is now transitioning towards a system in which GoldBod will have its own capital and operate more independently from the Bank of Ghana. Under this model, GoldBod will assume the commercial risks and rewards associated with its gold purchasing and trading activities. Losses from trading will no longer be placed directly on the books of the Bank of Ghana, while profits or other benefits will accrue to GoldBod.
A Strong Defence
Mr. Bentil rejected suggestions that the establishment of GoldBod was a policy mistake. He argued that the institution is the best Ghana has done with its gold resources yet and that public discussion should focus on identifying and correcting weaknesses rather than concluding that the entire GoldBod concept is fundamentally flawed. Mr. Bentil emphasized that Ghana's experience with gold trading and the challenges associated with the previous arrangement demonstrate the need for an institution capable of managing the commercial side of the country's gold resources.
Moving Forward
Despite acknowledging that GoldBod still has areas that need improvement, Mr. Bentil expressed confidence in the institution's ability to manage Ghana's gold resources. The transition towards a more independent GoldBod will allow the institution to take on the commercial risks and rewards associated with its activities. As Ghana continues to navigate the complexities of gold trading, the establishment of GoldBod represents a significant step towards more effective management of the country's gold resources.
Source: Joy Online
