Gold as an investment asset: Gold Board panacea to socio-economic dilemmas  

By Constance Gbedzo

Gold has always been a reliable store of value. It serves as a hedge against economic uncertainty. Throughout history, gold has been used for jewelry and decorative items. It represents wealth and status in many cultures.

Ancient civilizations crafted intricate gold artifacts for religious and ceremonial purposes. Gold is also used in dentistry for fillings, crowns, and bridges due to its durability. This intrinsic value makes gold extraction an important economic venture.

Ghana is one of the world's leading gold producers. The country aims to harness this asset for financial market development and economic resilience. To achieve these goals, Ghana has reformed its gold sector significantly.

A key reform is the establishment of the Ghana Gold Board (GoldBod). This state entity will transform the exploitation, trade, and regulation of gold. GoldBod has agreements with nine large mining companies to buy 20% of their output. This move aims to boost Ghana's gold reserves and stabilize the cedi.

These initiatives have already shown positive results. In April 2025, Ghana's gold exports reached nearly $900 million. This was the highest monthly value in over two years. Additionally, the Bank of Ghana's Domestic Gold Purchase Program has accumulated over $5 billion in reserves.

To maximize its mineral wealth, Ghana is focusing on value addition. The Royal Gold Ghana Ltd refinery will refine gold locally, creating jobs and retaining more value within the country. These strategic reforms highlight Ghana's commitment to benefiting from its gold resources.

The development of a strong regulatory framework by GoldBod is crucial for sustainability. The board can enhance gold output and foreign exchange inflows while stabilizing the cedi. So far, discussions around GoldBod have been encouraging.

Mr. Sammy Gyamfi (ESQ) leads this initiative as CEO with expertise in law and youthful energy. Gold plays a significant role in economic development as a reserve asset. It has evolved into a store of value and medium of exchange globally.

Investors continue to see gold as an appreciating investment that preserves wealth. Recently, investments linked to gold have gained popularity worldwide for diversification and security reasons. Its inherent value protects against inflation and currency devaluation.

Ghana can leverage various financial instruments tied to gold for macroeconomic stability. For instance, the Bank of Ghana introduced 'the Ghana Gold Coin' under its Domestic Gold Purchase Program in 2021 but did not promote it aggressively enough.

Adding options like Gold Exchange Traded Funds (ETFs) or mutual funds could mitigate risks long-term. A Gold ETF captures investor interest as an alternative to physical investments based on company performance and global trends.

Sovereign Gold bonds are issued based on grams of gold with an eight-year tenure option for early exit after four years while offering semi-annual interest payments.

Commodity derivatives like futures allow industry players to hedge or speculate on price movements based on underlying product values like gold.
Equity or debt products involve direct investment in mining projects but come with higher risks requiring thorough local due diligence.
Gold-backed instruments use gold as collateral; their risk-return profile depends on both market conditions and financial structuring.

Given these diverse uses, it's clear that gold remains a valuable investment choice over time.
Ghana should capitalize on these financial instruments for macroeconomic stability.
Financial institutions must design new investment products under the GoldBoD arrangement.
The Security Exchange Commission (SEC), along with other entities, should seize opportunities created by the Ghana Gold Board for private investors.