Ghanaian taxpayers face the prospect of recapitalising the Bank of Ghana (BoG) due to substantial losses from its Domestic Gold Purchase Programme (DGPP). Economist Professor Godfred Bokpin issued this warning, highlighting the programme's significant financial impact on the central bank's equity.
Professor Bokpin, from the University of Ghana, stated that describing these losses as mere transaction costs does not lessen their severe effect. He explained that the losses have directly reduced the BoG's equity, potentially creating a legal obligation for the state to inject new capital. This situation means ordinary Ghanaians could bear the financial burden of restoring the central bank's financial health.
This development fits into a broader narrative of fiscal challenges and the central bank's evolving role in Ghana's economy. The BoG's financial position has been a subject of intense debate, especially following its reported losses in recent years. An International Monetary Fund (IMF) assessment in 2025 indicated that the DGPP alone accounted for losses exceeding US$1.7 billion, which is equivalent to 1.5% of Ghana's Gross Domestic Product (GDP). Such figures underscore the immense scale of the financial strain.
Professor Bokpin, speaking on Channel One TV, acknowledged the DGPP's positive contributions. He noted that the programme has successfully integrated gold-related activities into the formal economy. This formalisation helps to combat illegal gold smuggling and has improved foreign exchange inflows into the country. However, he stressed that these benefits should not overshadow the programme's considerable financial cost.
He further criticised the growing trend of using the central bank's balance sheet for quasi-fiscal activities. These are government-like spending or revenue-raising actions undertaken by a central bank, often outside its core monetary policy mandate. Professor Bokpin warned that such practices systematically undermine the financial stability and independence of the institution. He argued that sacrificing the BoG's balance sheet in this manner is ultimately detrimental to the nation's economic well-being.
The economist's comments emerge amidst an escalating political and economic debate surrounding the DGPP's losses. The role of GoldBod, a state-owned gold purchasing entity, within the programme has also drawn significant scrutiny. Stakeholders are questioning the transparency and financial prudence of the programme's implementation. The need for clear accountability regarding these substantial financial outflows is paramount.
Looking ahead, policymakers must address the BoG's financial health with urgency. The potential need for taxpayer recapitalisation could divert crucial public funds from other essential services. Investors and financial markets will closely monitor the government's response to these challenges. Any recapitalisation plan will likely involve difficult decisions about public spending and revenue generation. The long-term implications for Ghana's fiscal stability and the central bank's credibility are significant.
The government's strategy to strengthen the BoG's balance sheet will be a key indicator of its commitment to sound economic management. This situation highlights the critical importance of maintaining strict financial discipline within state institutions. It also underscores the need for clear boundaries between monetary policy and fiscal operations to prevent future financial distress. The public will demand transparency and effective solutions to safeguard national finances.