Editorial: Dramatic Transformation Reshaping the Global Gold Industry
According to data from the Bank of Ghana, the country’s official gold reserves continue on an upward trajectory – reaching 31.37 tonnes by the end of April this year (2025).
This represents a significant jump from the 8.78 tonnes recorded in May 2023—an almost quadrupling within just under two years. The surge underscores the central bank’s approach to strengthening foreign reserves and improving financial stability via heightened gold purchases.
This initiative is part of a larger strategy by the Bank of Ghana to broaden its portfolio of assets and decrease dependence on conventional foreign currencies. After taking office, President John Dramani Mahama has implemented measures to regulate Ghana’s informal small-scale mining industry and redirect more of the nation’s gold production towards supporting overall economic growth.
The newly formed government set up the GoldBod — an organization responsible for regulating the trade of gold mined by independent prospectors. Following its establishment, GoldBod has been crucial in increasing regional gold stockpiles.
For example, it reached an important accord with nine major mining companies to require them to allocate 20% of their gold production for sale within the local market. This arrangement marks a considerable move towards bolstering national gold stockpiles and safeguarding the economy against foreign disruptions.
GoldBod will undertake acquisitions on behalf of the Bank of Ghana with the objective of strengthening the central bank’s substantial gold reserves even more. These nine gold mining companies will be compensated in Ghanaian cedi, calculated at a discount rate of 1% from the LBMA spot price.
In aggregate, they generate approximately 200 kilograms of gold each month. In addition to the recently inked purchase deals, GoldBod is implementing fresh rules aimed at the small-scale mining industry — which makes up 35% of Ghana’s overall gold production, generated $5 billion in export earnings in 2024, and provides employment to more than 1 million individuals.
With the implementation of the new system, GoldBod has become the sole organization permitted to purchase, trade, evaluate, and export artisanal gold. All previous gold-trading licenses granted by the erstwhile Precious Minerals Marketing Company (PMMC) and the Ministry of Lands and Natural Resources have been rescinded in favor of GoldBod’s authority.
GoldBod, however, states that local dealers will be given top priority during the current reissuance process.
Even though Ghana leads Africa in gold production, clandestine gold trafficking has severely drained the country—much of this illicit activity allegedly involves transporting the smuggled goods via air to locations such as Dubai and India.
Dubai and India emerged as key hubs for the nation's illicit gold trafficking primarily because of the high demand for unprocessed gold and comparatively lenient trade laws.
Indeed, the growing tide of illegal gold mining and smuggling poses a serious threat to the country’s financial stability. The country is estimated to lose billions of dollars annually due to gold smuggling, depriving government of much-needed tax revenue and foreign exchange.
Moderate assessments suggest that the nation incurs roughly $2 billion in annual loss of tax income as a result of illicit gold activities and smuggling.
In 2022 alone, 60 tonnes of gold worth an estimated US$1.2billion were smuggled out of the country through illegal channels – at the height of Ghana’s economic crisis. Even the UK government had cause to express deep concern over the increasing rate of gold smuggling in Ghana.
Smuggling operations involving large amounts of gold cannot happen without a network of facilitators. At least, the Mahama-led administration is taking concrete steps to sanitise the gold industry by stemming the high rate of smuggling the country’s most prized mineral. Commendation in this regard cannot be withheld.
Existing approaches to combat illicit mining must continue. The nation aims to address both supply and demand in order to efficiently resolve this issue. Under the UK-Ghana Gold Programme, GoldBod is collaborating closely with the Economic and Organised Crime Office (EOCO) to prevent gold trafficking at crucial border crossings.
Indeed, the crackdown on illegal gold trading has begun to bear fruit. We must not relent as a nation and give authorities the needed support to sanitise the gold sector and rid it of illegal gold traders and gold smuggling.
Campaigns informing the public about the detrimental impact of gold smuggling on the economy might generate societal pressure against individuals involved in such illicit activities. With strategic changes like implementing GoldBod along with stronger political commitment, the nation has the potential to reverse this trend.
Provided by SyndiGate Media Inc. Syndigate.info ).
