Economist Dr. Theo Acheampong has defended the Bank of Ghana’s decision to convert nearly half its gold reserves into foreign exchange, describing the move as strategic monetization rather than reckless selling.
The central bank’s liquidation of approximately 50 percent of its gold holdings has sparked controversy among some observers who question whether Ghana remains adequately exposed to the precious metal. Dr. Acheampong argues the decision aligns with international best practices for reserve management and actually strengthened Ghana’s financial position.
At the core of the transaction was liquidity. The economist explained that the Bank of Ghana capitalized on favorable gold prices to convert physical gold into usable foreign currency, improving the country’s ability to pay for imports, respond to economic shocks and meet immediate external payment obligations.
Total reserves increased despite the gold conversion, though their composition shifted significantly. Ghana now holds more liquid foreign currency and less physical gold, a change Dr. Acheampong characterizes as enhancing short term financial flexibility rather than representing lost value.
“The drop in gold tonnes alongside the large increases in gross and net reserves is consistent with monetization or conversion of gold into more liquid foreign exchange reserve assets, improving immediate liquidity and import cover, rather than building reserves by simply holding more physical gold,” he stated.
Gold’s share of Ghana’s net international reserves fell from approximately 41 percent in December 2024 to 23 percent in December 2025. As a proportion of gross international reserves, gold declined from about 29 percent to 19 percent over the same period.
Dr. Acheampong emphasized that Ghana’s current gold allocation remains within global norms. Internationally, gold typically comprises around 18 to 20 percent of central bank foreign reserve holdings at current market valuations. The Sub Saharan African average stood at 13 percent in 2024, making Ghana’s 19 to 23 percent share comfortable by regional standards.
The economist dismissed concerns that Ghana is now underexposed to gold, noting that even after the substantial liquidation, the country is not an outlier among central banks. Most advanced and emerging economies maintain gold shares in moderate ranges, prioritizing liquidity and deployment speed over long term storage.
“A few of the advanced economies like the United States have more gold as a share of their reserves, but for most others it is typically in the 20 to 30 percent range due to the need for liquidity,” Dr. Acheampong said.
While physical gold holds intrinsic value, the economist noted it cannot be easily deployed to settle import bills, stabilize currency or meet urgent external payments during crises. Foreign exchange reserves offer immediate usability that physical gold stocks cannot match.
The conversion strategy reflects modern reserve management principles that emphasize liquidity, flexibility and rapid response capabilities. Countries increasingly need assets they can deploy instantly rather than holdings that primarily function as long term insurance against economic uncertainty.
Ghana’s reserve buildup in 2025 was tilted toward accumulating liquid dollars rather than expanding physical gold stocks, according to Dr. Acheampong’s analysis. This approach prioritizes what can be used immediately over what merely sits in storage vaults.
The Bank of Ghana has not publicly disclosed the specific timing or pricing of gold sales executed during 2025. The central bank operates under statutory authority to manage Ghana’s external reserves and make portfolio allocation decisions aimed at maintaining financial stability.
Critics of the gold liquidation have raised questions about transparency and whether the sales secured optimal pricing given gold market volatility. Some observers have called for parliamentary oversight of major reserve composition changes, though existing law grants the central bank operational independence in reserve management.
Gold prices reached historic highs during 2024 and early 2025, with international spot prices exceeding 2,700 United States dollars per troy ounce at various points. The favorable pricing environment provided an opportune window for central banks seeking to rebalance reserve portfolios toward more liquid assets.
Ghana’s gross international reserves stood at approximately 7.8 billion dollars in December 2024 before the gold conversions. Updated figures reflecting the 2025 reserve composition changes have not been officially released by the Bank of Ghana as of this publication.
The International Monetary Fund (IMF) recommends that developing economies maintain import cover of at least three months as a buffer against external shocks. Adequate foreign exchange reserves enable countries to defend their currencies, service external debt and maintain confidence among international creditors and investors.
Dr. Acheampong concluded that the gold monetization represents a calm and deliberate strategy rather than a risky gamble. For households, businesses and investors, he characterized the move as reassuring evidence that Ghana’s reserves are stronger, more usable and aligned with international best practice.
The debate over optimal reserve composition continues among economists and policymakers. While some advocate maintaining higher gold allocations as insurance against currency devaluation and geopolitical instability, others emphasize that liquid foreign exchange provides superior crisis response capabilities for developing economies.
Central banks globally have incrementally increased gold holdings in recent years as part of diversification strategies, particularly amid concerns about dollar dominance and Western sanctions. Ghana’s decision to reduce gold exposure runs counter to this trend but aligns with liquidity focused reserve management approaches.
