The Bank of Ghana (BoG) has unveiled the Ghana Gold Coin, a new investment initiative aimed at reducing the dollar hoarding going on in the country.
As part of the domestic gold programme, this initiative seeks to absorb excess liquidity in the market and strengthen the local currency against major trading currencies.
It is said that the coin will be available in three denominations: a one-ounce coin, a half-ounce coin, and a quarter-ounce coin, and will be sold in commercial banks within two weeks. The one-ounce coin, the half-ounce coin, and the quarter-ounce coin have been made to suit different investment dates. Each coin has the Ghana quote of arms in front and the independence arch at the back.
Speaking at the Monetary Policy Committee (MPC) meeting on Friday, September 27, Dr. Ernest Addison, Governor of the Bank of Ghana, announced that the prices for the coins will be published on the BoG’s website.
“The Ghana Gold Coin is manufactured from dowry gold dug out of Ghana which has been refined to 99.99 percent purity. It is issued and guaranteed by the BoG.
“The packing of the gold coin will be a wooden story box, a transparent coin holder and a certificate of ownership. The Ghana Gold enables the BoG to mop up extra liquidity from the banking sector and will supplement the use of our BoG bills… It gives savers residence in Ghana, an additional avenue to invest, and reap the benefits of the BoG domestic Gold purchase programme.”
This strategic move aligns with the Bank of Ghana’s efforts to stabilize the economy and promote investment in Ghana’s gold reserve.
The next Monetary Policy Committee meeting is scheduled for November 20-22, 2024. The meeting will conclude on Monday, November 25, 2024, with the announcement of the policy decision.
However, in a contrarian twist, Economist Professor Godfred Bokpin has stated that the Ghana Gold Coin is not a viable solution to the depreciation of the cedi.
Despite the initiative’s goals, Professor Bokpin maintains that it is not a comprehensive solution to the cedi’s depreciation.
But Prof Bokpin in an interview on Eyewitness News on Citi FM on Friday indicated that “I associate with the intervention from the central bank to the extent that there are very limited alternative avenues right now in the market and therefore any genuine attempt to offer alternatives would be welcomed and the next important question as you rightly asked is whether this is the solution.
“We have been waiting for this all this while and I think it is not too hard to look for that and to conclude that that is not the solution.”
“The reason is as much as we acknowledge that this is an alternative, the market is dry largely also because of confidence and all of that. This is not the solution.”
Prof Bokpin posited that the introduction of the coin was not a substitute for managing the economy well.
“I want to believe that it is not packaged as a substitute for managing the economy well because the fundamental thriving factors pushing the cedi to lose its own against the major trading currencies when it comes to fiscal discipline when it comes to enhancing the capacity of the local economy, less import reliance, adding value to the export of your raw commodities, this doesn’t substitute for all of that,” he added.
Source: CitiNews
