Associate Professor of Finance at Andrews University in the United States, Prof William Kwasi Peprah, has urged Ghana to use the current surge in gold prices to protect the economy against future shocks.
Speaking on Joy News’ PM Express on Wednesday, Prof Peprah said Ghana must take advantage of what he described as a windfall and set up a dedicated gold stabilisation fund to cushion the country when prices fall.
“So now that we are having this windfall, we should be able to establish another stabilisation fund purposely for gold, to put in that money to guard against… that will come in,” he said.
Prof Peprah described the Gold Board concept as a good idea but warned that, for it to work effectively, it must be backed by a clear stabilisation account, similar to those already in place for cocoa and petroleum.
“So the gold board idea is very good. However… the one that exists is a cocoa one, and we also have one for petroleum. If the gold board will work, we need another stabilisation account for the gold,” he stressed.
He explained that gold prices are rising due to global uncertainty and investor behaviour. He said gold is traded based on three main angles: fear, inflation, and currency hedging.
“One, when there is fear… and then a currency hedge… we currently have fear, so many things happening in the world, which makes investors uncertain. So that is why we are seeing the gold price really, really moving up,” he said.
He also pointed to currency pressures as another driver of the current rally.
“We’ve noticed that the US dollar is devaluing, and that’s why we see investors moving into gold,” he added.
While he acknowledged that gold has historically risen over time, he cautioned that prices can still fall and Ghana must prepare for that possibility.
“The law is good, the operationalisation is where we must watch it carefully and make sure that… the price… will still start to come down,” he said.
Prof Peprah said the stabilisation fund should be designed to support the gold industry and the broader economy when gold prices eventually decline.
“My advice… is that whatever amount of gold sales that is coming that we are putting in our balance of payment account, and we create that fund just for gold, and then to make sure that when the price starts to drop, we’ll be able to use it support the gold industry in Ghana,” he said.
He also raised concerns about how the Gold Board will be financed, warning that weak financing could create future challenges.
“The financing model for the gold board also needs to be looked at a little bit,” he said.
He noted that the Gold Board has relied on government funding, but those releases have been inconsistent.
“It has raised, getting money from the government of Ghana, which we know the amount they promised was not fully released in 2025,” he said.
He added that with the Bank of Ghana set to exit financing the gold trade, the Gold Board must carefully review the alternative model provided in the law.
“In the law, it allows them to take money in advance from whoever needs gold, and then be able to give them the gold,” he said.
Prof Peprah warned that without the right structure, the Gold Board could risk becoming another troubled commodity institution.
“So that gold board does not tend to the next Coco board,” he cautioned.
He concluded that Ghana must avoid overdependence on gold in the absence of a robust buffer, particularly given the volatility of other commodities.
“If we feel on gold… our trade balance will move into a very struggling position,” he said.
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