Ghana’s gold industry is enjoying a historic boom.

New data from the Bank of Ghana show that gold exports reached $8.3 billion in the first half of 2025, almost double the figure recorded over the same period in 2024, and the highest half-year total since at least 2016.

Gold accounted for 64% of Ghana’s total exports of $13 billion between January and June, underscoring its dominance in the country’s trade.

Global market conditions have helped. Gold prices have remained elevated throughout the year, currently hovering around $3,290 per ounce. That is slightly below the April peak of $3,500, but well above the 2024 average of $2,300.

The rally has been driven in part by global uncertainty following the return of Donald Trump to the White House in January. Concerns over his erratic trade and fiscal policies have pushed investors to seek safety in gold. Central banks, too, are adding to their stockpiles.

By the end of 2024, gold had overtaken the euro as the second-largest reserve asset globally, according to the European Union.

This global appetite is paying off for Ghana, Africa’s largest gold producer. The country mined 4.8 million ounces of gold in 2024, up 19% from 4 million ounces in 2023.

That gold alone brought in $11.6 billion in export earnings last year. If current trends hold, Ghana could end 2025 with more than $16 billion in gold exports.

Behind the record numbers lies a structural shift. Small-scale miners are driving a growing share of Ghana’s gold production. In 2023, they accounted for 27% of total gold output. By 2024, their share had jumped to 39%.

According to the Finance Ministry, the Ghana Gold Board (formerly the PMMC) purchased $5 billion worth of gold from small-scale miners in just the first half of 2025. At an average price of $3,200 per ounce, that translates to roughly 1.5 million ounces.

For context, small-scale miners produced 1.8 million ounces in all of 2024.

The numbers raise questions. Has production increased that sharply? Or is previously smuggled gold now being captured in official statistics? Another possibility is that unregulated “galamsey” gold is being laundered into the system. The truth may be a mix of all three.

Whatever the case, the Gold Board’s lack of a robust gold tracing system leaves the door open to abuse.

One milestone stands out. Ghana’s gold exports in the first half of 2025 exceeded total imports for the same period.

Gold earned $8.3 billion, while imports amounted to $8.2 billion. This is the first time since at least 2016 that gold exports alone have outpaced imports.

It also matters where the money goes. Because the Gold Board is mandated to surrender its foreign exchange earnings to the Bank of Ghana, the entire $5 billion from its purchases ends up with the central bank. That is a major reason the cedi has remained strong this year.

But there are risks. Ghana still exports raw gold, leaving the economy vulnerable to swings in international prices.

A hedging strategy is reportedly being developed by the central bank, but more needs to be done. Chief among them is establishing a modern gold refinery and enforcing traceability mechanisms across the supply chain.

The current gold windfall offers a rare opportunity. It could be used to strengthen the currency, create jobs, and build economic resilience. But that will require moving beyond exporting unrefined gold ore.

It will also require environmental responsibility and proper oversight. There is no justification for economic growth while destroying forests and polluting rivers.

Ghana is riding high on gold. But what matters now is what we do with the gains.

DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.

DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.

Ghana’s import cover has risen to 4.8 months by June 2025, marking its strongest position in years according to Bank of Ghana data.

This metric reflects the duration foreign reserves can finance imports without new currency inflows, a critical stability indicator for trade-reliant economies.

The improvement signals enhanced capacity to manage essential commodity imports like fuel, food, and pharmaceuticals.

Gross International Reserves surged to $11.12 billion by mid-2025, up from $6.86 billion a year earlier. Usable reserves excluding funds committed to debt obligations stand at $8.86 billion, providing 3.8 months of effective import coverage compared to 2.6 months in June 2024. Central bank records confirm steady growth from 3.4 months in mid-2024 to 4.3 months by December before the current peak.

Economists note that import cover below safe thresholds historically triggered cedi depreciation, inflation spikes, and supply disruptions, as witnessed during Ghana’s 2022–2023 reserve crisis.

The current buffer mitigates risks from global oil volatility or delayed donor inflows. Sustaining this position requires prudent management, as reserves rely heavily on gold exports, trade balances, and debt restructuring inflows.

While the rebound offers economic breathing space, long-term stability hinges on maintaining export competitiveness and disciplined fiscal policies under President John Mahama’s administration.

Prof Isaac Boadi, Executive Director of IERPP

The Institute of Economic Research and Public Policy (IERPP) has described the 2025 Mid-Year Budget as contradictory, misleading, and technically unsound.

According to the institute, while the government claims there is no need to revise macroeconomic targets, it quietly adjusts revenue and expenditure estimates, an inconsistency that threatens budgetary credibility and public trust.

Speaking at a press conference held on Wednesday, July 30, 2025, Prof Isaac Boadi, Executive Director of IERPP and Dean of the Faculty of Accounting and Finance at the University of Professional Studies, Accra (UPSA), dissected key real sector component of the budget under the theme: “Unpacking Critical Elements of the Government’s 2025 Mid-Year Fiscal Review.”

“The 2025 Mid-Year Budget contradicts itself: it claims no need to revise targets yet adjusts revenue and expenditure. It’s like changing a recipe but expecting the same dish—misleading and technically unsound,” Prof Boadi stated.

Prof Boadi pointed out that the Mid-Year Fiscal Policy Review presented to Parliament on July 24 portrays a picture of economic progress, citing improvements in inflation rates, currency stabilization, and fiscal consolidation. However, he argued that this optimistic framing conceals more troubling realities.

For example, he mentioned that while government revenue and grants have been revised upward by 1.3%, total expenditure has been marginally revised downward from GH¢270.9 billion to GH¢269.5 billion.

According to Prof Boadi, this kind of adjustment, without a corresponding revision of macroeconomic targets, defies budgetary logic and risks undermining public confidence in economic governance.

“If the assumptions underlying budget projections change, logic and prudence demand a corresponding revision of targets,” he emphasized.

He also criticized what he called the selective presentation of fiscal data. Though the finance minister touted a primary surplus and a narrowing fiscal deficit, Prof Boadi argued these achievements are partially the result of deferred expenditures and significant underperformance in oil revenues and grants.

He further noted the dismal performance of arrears clearance and drastic shortfalls in project loan disbursements, raising doubts about the government’s capacity to execute long-term investments.

More concerning, he said, is the government’s continued reliance on short-term domestic borrowing, particularly through treasury bills, which pose rollover risks and threaten fiscal sustainability.

“Ghana’s public debt remains elevated, and the financing gap continues to be bridged primarily through short-term domestic borrowing. This strategy is unsustainable and exposes the economy to rollover risks,” Prof. Boadi warned.

He added that while the government speaks of fiscal discipline, it has instead moved the goalposts in ways that raise questions about transparency and accountability.

“The public deserves transparency, not clever accounting. Ghana’s budgetary credibility hinges not only on numbers but also on consistency between stated intentions and actual fiscal maneuvers,” he further stated.

Dr George Domfe, Senior Research Fellow at the Institute of Economic Research and Public Policy (IERPP) and the Centre for Social Policy Studies (CSPS) at the University of Ghana also cautioned government officials and policymakers against growing optimism over the country’s recent economic performance.

According to Dr Domfe, Ghana’s recent economic successes including a historic trade surplus of $4.98 billion in 2024 and a notable appreciation of the cedi must not lead to complacency.

He noted that while these developments signal short-term relief, deeper structural vulnerabilities persist and must be urgently addressed to prevent a reversal of gains.

“Over-reliance on gold exports, persistent dependence on the International Monetary Fund, and our chronic import addiction remain dangerous pressure points for our economy.

“These are not just economic habits; they are structural risks. Without bold and sustained reforms, the cedi may return to its familiar cycle of depreciation, and Ghana’s fiscal space could once again narrow,” Dr Domfe stated.

AM/MA

Meanwhile, watch as Prophet Worlasi shares bombshell prophesies on Bawumia and NPP on The Lowdown:

The Monetary Policy Committee (MPC) of the Bank of Ghana has cut the policy rate by 300 basis points to 25 per cent from 28 per cent.

Dr. Johnson Pandit Asiama, the Governor of the Bank of Ghana, who announced the rate at a press briefing following the conclusion of the MPC’s 125th regular meetings in Accra, said the decision was reached on the back of significant improvements in the economy.

“Overall, the Committee noted that macroeconomic conditions have significantly improved, inflation expectations are broadly anchored, external buffers have strengthened, and confidence in the economy is returning,” he said.

Dr Asiama said the July forecast also showed that headline inflation was expected to decline further in the third quarter of 2025, and trend within the medium-term target of 8±2% by the end of 2025, earlier than initial projections.

“However, there are upside risks to the inflation outlook, which include potential supply chain challenges emanating from global trade tensions and upward adjustment in utility tariffs,” he said.

These notwithstanding, the impact of these risks on inflation are expected to be offset by appropriately tight monetary policy stance and continued fiscal consolidation.

He said the Committee would continue to assess incoming data and likely reduce the policy rate further should the disinflation trend continue.

The Committee remains committed to the price stability mandates while creating conditions for inclusive and sustainable growth.

The meetings evaluated recent economic developments and risks to the inflation outlook.

He said alongside the slower growth prospects, the pace of disinflation had moderated, and in response, financial conditions remain restrictive with potential spillover to emerging markets and developing economies.

However, the improved domestic macroeconomic conditions are expected to moderate the risks from the global economy.

On the domestic front, the economy was buoyant in the first quarter of 2025, with an annual GDP growth of 5.3 percent, compared to 4.9 per cent in the same quarter of 2024, driven by increased activity in the agriculture and services sectors.

He said excluding oil, the economy grew by 6.8 percent compared to 4.3 per cent over the same comparative period.

Beyond the first quarter, the Bank’s high frequency real sector indicators pointed to sustained pickup in economic activity.

He said the latest business and consumer confidence surveys reflected improved sentiments on the back of easing inflationary pressures and strong optimism about economic conditions.

 The Governor said since the last MPC meeting, headline inflation has declined further to 13.7 per cent in June 2025 from 18.4 percent in May, the lowest reading since December 2021.

He said the deceleration was underpinned by the tight monetary policy stance, fiscal consolidation, easing food supply constraints, as well as the strong recovery of the cedi.

“In line with the easing underlying inflation pressures, the Bank’s main core inflation measure, which excludes energy and utility items, has declined markedly,” he added.

He said the growth in monetary aggregates remained subdued during the first half of the year, primarily due to the tight monetary policy stance, strong liquidity management, and reduced government borrowing.

Dr Asiama said in line with the disinflation process and easing inflation expectations, interest rates at the short end of the money market had declined sharply, and in turn, reduced the cost of government borrowing.

He said in the banking sector, the Financial Soundness Indicators reflected continued asset growth, improved solvency, liquidity, profitability and efficiency in the first half of the year.

The Governor said continued improvement in the economic conditions, ongoing recapitalisation efforts from capital injections and profits, coupled with the implementation of strict credit underwriting standards should enhance resilience in the banking sector.

He said the external sector has improved markedly, with a record current account surplus of $3.4 billion in the first half of 2025, supported mainly by higher prices and increased production volumes of gold and cocoa.

The sector’s outlook was positive, anchored on favourable commodity prices and improved remittance inflows, despite the resumption of external debt service.

On the back of the strong external sector performance and increased reserve accumulation, the cedi has further strengthened against the major trading currencies.

In the year to 25 July 2025, the cedi appreciated by 40.7% against the US dollar, 31.2% against the British pound, and 24.2% against the euro.

“The Committee remains committed to he price stability mandate, while creating conditions for inclusive and sustainable growth,” Dr Asiama added.

Source: GNA  

The Bank of Ghana has slashed its monetary policy rate by 300 basis points, reducing it from 28 percent to 25 percent.

The decision was unanimously approved by the Central Bank’s Monetary Policy Committee (MPC) following its 125th scheduled meeting.

Chairman of the MPC and Governor of the Bank of Ghana, Dr Johnson Asiama, addressing the media on July 30, 2025, said the rate cut reflects sustained improvements in macroeconomic indicators, a steady decline in inflation, and growing investor and consumer confidence.

See the full statement by the BoG Governor below:

Good afternoon, ladies and gentlemen of the press.

Thank you for attending this press briefing, which follows the conclusion of the MPC’s 125th regular meetings, held from Monday, 28 July 2025, to evaluate recent economic developments and risks to the inflation outlook. This briefing summarises the key discussions and the Committee’s decision on the monetary policy stance.

Since the last MPC meeting in May, the global economic outlook has become more challenging with increased economic and trade policy uncertainties. The prolonged bilateral tariff actions and retaliatory actions, amid rising geopolitical tensions, are projected to constrain global growth. According to the IMF, global growth is likely to slow to 3.0 percent in 2025 from 3.3 percent in 2024. Alongside the slower growth prospects, the pace of disinflation has moderated, and in response, financial conditions remain restrictive with potential spillover to emerging markets and developing economies. However, the improved domestic macroeconomic conditions are expected to moderate the risks from the global economy. On the domestic front, the economy was buoyant in the first quarter of 2025, with an annual GDP growth of 5.3 percent, compared to 4.9 percent in the same quarter of 2024, driven by increased activity in the agriculture and services sectors.

Excluding oil, the economy grew by 6.8 percent compared to 4.3 percent over the same comparative period. Beyond the first quarter, the Bank’s high frequency real sector indicators pointed to sustained pickup in economic activity. The Composite Index of Economic Activity (CIEA) grew by 4.4 percent year-on-year, in May 2025 compared to 3.4 percent in the same period of 2024. International trade activities, consumption, construction and tourist arrivals contributed to the improvement in economic activity during the period.

The latest business and consumer confidence surveys reflected improved sentiments on the back of easing inflationary pressures and strong optimism about economic conditions.

Since the last MPC meeting, headline inflation has declined further to 13.7 percent in June 2025 from 18.4 percent in May, the lowest reading since December 2021. The deceleration was underpinned by the tight monetary policy stance, fiscal consolidation, easing food supply constraints, as well as the strong recovery of the cedi. In line with the easing underlying inflation pressures, the Bank’s main core inflation measure, which excludes energy and utility items, has declined markedly. Similarly, inflation expectations by banks, consumers, and businesses are broadly anchored.

Growth in monetary aggregates remained subdued during the first half of the year, primarily due to the tight monetary policy stance, strong liquidity management, and reduced government borrowing.

In line with the disinflation process and easing inflation expectations, interest rates at the short end of the money market have declined sharply, and in turn, reduced the cost of government borrowing.

Data on budget execution indicated a strong commitment to fiscal consolidation as expenditures adjusted within set targets to accommodate the revenue shortfalls during the first half of 2025. As a result, the overall fiscal deficit on commitment basis was 0.7 percent of GDP, outperforming the budget target of 1.8 percent of GDP.

The deficit was largely financed from domestic sources. At end-June 2025, the total public debt had declined to 43.8 percent of GDP from 61.8 percent of GDP at end-December 2024, due to the appreciation of the cedi, lower domestic borrowing, and the external debt restructuring.

In the banking sector, the Financial Soundness Indicators reflected continued asset growth, improved solvency, liquidity, profitability and efficiency in the first half of the year.

The non-performing loan ratio eased in June 2025 on account of lower growth of non-performing loan stock relative to credit. Continued improvement in the economic conditions, ongoing recapitalisation efforts from capital injections and profits, coupled with the implementation of strict credit underwriting standards should enhance resilience in the banking sector.

The external sector has improved markedly, with a record current account surplus of US$3.4 billion in the first half of 2025, supported mainly by higher prices and increased production volumes of gold and cocoa. The current account surplus, together with the outturns in the capital and financial accounts, culminated in an overall balance of payment surplus of US$2.2 billion, significantly higher than the US$588.5 million recorded in June 2024. On this score, Gross International Reserves stood at US$11.1 billion at end-June 2025, equivalent to 4.8 months of import of goods and services, compared to US$8.9 billion (4.0 months of import cover) as at end-December 2024.

The external sector outlook is positive, anchored on favourable commodity prices and improved remittance inflows, despite the resumption of external debt service. On the back of the strong external sector performance and increased reserve accumulation, the cedi has further strengthened against the major trading currencies. In the year to 25th July, 2025, the cedi appreciated by 40.7 percent against the US dollar, 31.2 percent against the British pound, and 24.2 percent against the euro. Overall, the Committee noted that macroeconomic conditions have significantly improved, inflation expectations are broadly anchored, external buffers have strengthened, and confidence in the economy is returning. The July forecast also shows that headline inflation is expected to decline further in the third quarter of 2025 and trend within the medium-term target of 8±2 percent by the end of 2025, earlier than initial projections.

However, there are upside risks to the inflation outlook, which include potential supply chain challenges emanating from the global trade tensions, and upward adjustment in utility tariffs. This notwithstanding, the impact of these risks on inflation are expected to be offset by appropriately tight monetary policy stance and continued fiscal consolidation

Given these considerations, the Committee, by a majority decision, voted to lower the Monetary Policy Rate by 300 basis points to 25.0 percent. Looking ahead, the Committee will continue to assess incoming data and likely reduce the policy rate further, should the disinflation trend continue. The Committee remains committed to the price stability mandate, while creating conditions for inclusive and sustainable growth.

MA