The Bank of Ghana (BoG) recognizes the essential role that gold plays as a strategic reserve asset and its significant impact on economic development. However, the Central Bank emphasizes the importance of responsible gold mining to maximize benefits while minimizing environmental harm.
To this end, the Bank has introduced its Responsible Sourcing Programme, designed to ensure the ethical procurement of gold. This Responsible Gold Sourcing Policy Framework includes the Domestic Gold Purchase Programme (DGPP), which outlines its processes, Know Your Customer (KYC) and due diligence requirements, supply chain transparency, and thorough risk assessments.
The DGPP operates under two main models: Gold for Reserves and Gold for Oil. By implementing stringent KYC and due diligence measures, the Bank of Ghana aims to ensure that its gold purchases do not contribute to human rights violations, spark conflict, or cause lasting environmental damage, all while complying with Ghana’s legal regulations.
Through the Gold for Oil initiative, the government plans to use locally sourced gold to pay for imported oil products, creating a direct barter arrangement with gold acquired by the Central Bank. According to the G40 Programme Framework (issued on February 3, 2023), oil payments are structured in two ways: direct barter or through foreign exchange generated by selling gold to brokers.
In the barter system, suppliers willing to accept gold in exchange for petroleum products will receive an equivalent amount from the Bank of Ghana. Alternatively, under the broker system, the Central Bank will establish gold supply agreements with brokers, selling gold in exchange for foreign currency to fund oil imports.
SOURCE: https://dew360.net
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