Ghana starts gold purchase scheme to strengthen currency

ACCRA - Ghana has started a bulk purchase programme to buy gold locally to raise the gold component of its reserves, Central Bank Governor Ernest Addison said on Tuesday, in a bid to strengthen the cedi currency without increasing inflation.

“We have started a bulk purchase programme, domestic, where we buy gold locally and try to raise the gold component in our level of reserves. This is where the currency focus is,” Addison said at a conference.

The gold, oil and cocoa producing country saw consumer inflation rise to an 18-year record of almost 24 percent in April despite efforts to contain price hikes and spur recovery.

The Ghana cedi saw the worst depreciation against the dollar of any currency besides the Russian ruble between January and March, according to Reuters data.

Its value has mostly stabilized since then, although it experienced another downturn over the last week.

Meanwhile, Ethiopia and the

World Bank have signed a pact for a grant of $300 million to assist reconstruction and recovery in conflict-hit areas, the finance ministry said.

Fighting that erupted in the northern region of Tigray in November 2020, and spilled over into neighbouring Afar and Amhara last year, has eased since a unilateral ceasefire by the federal government in March.

“The resource will be used to finance the activities designed to support … basic services,” the ministry said in a statement.

Services that stand to benefit are education, health, water supply and a special effort to support survivors of gender-based violence in conflict-hit areas, it said.

Areas in Amhara, Afar, Tigray and the regions of Oromia and Benishangul-Gumuz are targeted to receive the funds, it said, adding that the government would sign up with third-party organisations to execute the project in high-conflict areas. – REUTERS.