The Vice President, Dr Mahamudu Bawumia, has announced that Ghana has concluded talks for the operationalisation of the Gold for Oil policy.
In a Facebook post on Thursday, the Vice President said the first oil products under the policy will be delivered in January 2023.
The Gold for Oil barter deal will see Ghana getting cheaper fuel in exchange for gold.
The arrival of the fuel from the United Arab Emirates (UAE) is expected to push prices of fuel further down after the recent reduction in the price of fuel.
“I am happy to announce that the Government of Ghana has concluded the arrangements for the operationalization of the Gold for Oil policy.
“Consequently, the first oil products under the policy will be delivered next month (January 2023). My thanks to the Minister for Energy, Minister for Lands and Natural Resources, Governor of the Bank of Ghana, the Chamber of Mines, PMMC and BOST for their leadership in the operationalization of the
Government’s Gold for Oil Policy.”
The move by the government is meant to tackle dwindling foreign currency reserves coupled with the demand for dollars by oil importers, which is weakening the local cedi and increasing living costs.
Ghana’s Gross International Reserves stood at around $6.6 billion at the end of September 2022, equating to less than three months of imports cover. That is down from around $9.7 billion at the end of last year, according to the government.
The proposed policy is uncommon. While countries sometimes trade oil for other goods or commodities, such deals typically involve an oil-producing nation receiving non-oil goods rather than the opposite.
Ghana produces crude oil but it has relied on imports for refined oil products since its only refinery shut down after an explosion in 2017.