Asiama Makes Case for Gold Sale to Parliament

…Concentration Risk’ Cited as BoG Rebalances Reserves After Price Surge

Front Desk

Bank of Ghana Governor Johnson Pandit Asiama yesterday mounted a vigorous defence of the central bank’s recent decision to trim its bullion holdings, appearing before the Parliamentary Committee on Economy and Development to argue that the move was a textbook case of risk management rather than a depletion of the nation’s wealth.

Dr. Asiama revealed that the Bank’s aggressive Domestic Gold Purchase Programme had, by October 2025, swollen its gold reserves from a paltry 8.7 tonnes in 2021 to over 40 tonnes. However, this accumulation coincided with a meteoric 62 percent rally in global gold prices during the first ten months of last year. The dual effect, he told lawmakers, left gold accounting for a striking 42 percent of Ghana’s Gross International Reserves—a concentration he deemed unsustainable.

“Gold is a critical asset, but that level of exposure creates significant portfolio concentration risk,” Dr. Asiama explained. He cited reserve management frameworks from the International Monetary Fund and data from the World Gold Council, noting that economies at Ghana’s stage of development typically cap gold at around one-fifth of their reserves.

The Governor stressed that Ghana’s status as a major gold producer only amplified the need for diversification. “Our economy is already heavily exposed to the vagaries of the gold price,” he said, warning against a double-layered vulnerability.

Unlike advanced economies with deep financial markets, Dr. Asiama argued that Ghana’s reserves must be immediately deployable to defend the cedi, finance imports, and absorb external shocks. “Reserves must not only be valuable; they must be liquid, diversified, and ready to use,” he told the committee.

To correct the imbalance, the Bank executed what he termed a “measured portfolio rebalancing,” converting an undisclosed portion of its gold into foreign exchange. He flatly rejected any notion that the transaction represented a loss, emphasising that the proceeds remain actively invested within the reserve portfolio, now generating returns in a more liquid form.

In a clear signal to those who might question the timing of the sale, Dr. Asiama dismissed the logic of short-term speculation. “Central banks do not manage reserves based on price forecasts,” he stated firmly. “Our focus is the triad of liquidity, safety, and diversification.”

His testimony appeared aimed at preempting criticism that the Bank had missed out on potential further gains, instead framing the move as a prudent, standard practice to bolster the resilience of Ghana’s external buffers against an unpredictable global landscape.