Vice President Dr Mahamudu Bawumia has disclosed that the government intends to extend its Gold-for-Oil policy to cover all oil imports before 2024.
According to him, the programme applies to only 60% of imports, and the government was making efforts to expand the initiative.
Speaking at a forum organized by the Bulk Oil Storage and Transformation (BOST) company in Accra on Wednesday, March 15, Dr Bawumia said: “The most important aspect of the gold-for-oil policy is not just the reduction in fuel prices, but the most important aspect is the savings in foreign exchange that the Bank of Ghana will make as a result of the lower demand for forex to import oil. That saving is huge. We are currently importing about 50 to 60 per cent of oil under this policy, the goal is to move to 100 per cent, and that will be done this year.”
He added, “We have to understand that prices of fuel will go up and will come down, but what we expect to see under the Gold-for-Oil policy is more stability in the pricing and also savings in foreign exchange.
“There is more to come. This is the third month of operation of the policy. Some people said it would not work, and Ghana didn’t have enough gold. How can you say that? We have been mining this gold for 200 years, and they keep taking it out, and it cannot work for us?
“It doesn’t make sense. There are people who are very disappointed that it is working, but bleeding is allowed. We have an impossibility mindset, and they can keep to it. For us, all things are possible by the grace of God.”
He further said, “I am happy to note that the Gold-for-Oil policy is the first policy of its kind in Ghana since independence to address this type of balance of payment crisis that we face. In my humble opinion, this is the most important macroeconomic policy intervention to deal with the exchange rate depreciation, fuel prices, food prices, and inflation nexus that we have had.
“As a result of the policy, we have not only seen a decline in the price from 23 Cedis per liter to around 12 Cedis per litre, we have also seen stability in the exchange rate as we predicted,” he expressed.
Ghana took delivery of the first consignment of 40,000 metric tons of oil at the Tema port on Sunday, January 15, 2023.
The gold for oil initiative is an attempt by the government to move away from the US dollar for international transactions.
The Chief Executive Officer of the National Petroleum Authority (NPA), Dr Mustapha Abdul-Hamid, said that Ghana received 40,000MT of diesel and 35,000MT of petrol for 40 million dollars, which arrived weeks ago and is being discharged.
He indicated that in consultation with the Association of Oil Marketing Companies (AOMCs), it had been decided that only Oil Marketing Companies (OMCs) with 45 retail outlets would receive products.
He said that this was to ensure consumers across the country felt the impacts of the G4O programme.
“In this second consignment of gold for oil products that have come we are going to sell only to OMCs with not less than 45 outlets because there are 150 OMCs , if you are selling in pieces to all the 150 OMCs you will not realize the impact but if you are selling to the people with the highest number of outlets then its effect will be felt across the country in terms of the prices reduction,” he said at a press conference in Accra on Wednesday, February 22.
