A challenge for economic policy researchers: What is the price of the Ghana GoldBod policy?

Ghana set up GoldBod in 2025. It buys gold from small-scale miners, exports the gold to generate foreign exchange and build reserves, and the resulting increase in dollar supply strengthens the currency, with downstream effects across the economy.

But the model also lost a significant amount of money doing it.

So, is it worth it?
Nobody has really answered that question properly. Here is how you could try.

1.⁠ ⁠Start with the counterfactual.
Ask what would have happened without GoldBod. The answer isn’t “nothing.”

Compare the GoldBod model with the arrangement that existed before 2025, or with a properly licensed and taxed private export market. Every cost and benefit should be measured against that alternative.

2.⁠ ⁠Add up the costs.
Include the losses from buying and trading the gold, interest on the funds tied up in the programme, the cost to the Bank of Ghana of sterilising the cedis created to purchase the gold, the cost of running GoldBod, and the opportunity cost of public resources allocated to the programme.

Then add the tax revenue forgone from changes to the taxation of the sector.

And don’t ignore environmental costs. A guaranteed buyer can increase incentives to mine. What is the economic cost of the additional environmental damage?

3.⁠ ⁠Add up the benefits.
These could include:
Additional foreign exchange reserves
Gold captured from smuggling channels
Additional royalties and taxes
Income generated for small-scale miners
Better information on who is producing and exporting gold

Improved exchange-rate performance
The downstream economic benefits of a stronger currency, including lower inflation, lower debt-servicing costs and lower interest rates

4.⁠ ⁠Separate real economic costs from transfers.

This is important.
If government transfers money to aggregators and that money is lost from the public budget, it is a fiscal cost. But the money may still remain within Ghana’s economy.

A poisoned river is different. That is a real economic loss to Ghana that doesn’t simply move from one Ghanaian balance sheet to another.

Not all “costs” are economically equivalent.

5.⁠ ⁠Strip out the gold-price boom.
Record gold prices can make the programme’s reserve accumulation look better while simultaneously increasing the cost of purchasing gold.

Try to isolate how much of the outcome is attributable to GoldBod’s model and how much is simply the result of exceptionally high gold prices.

6.⁠ ⁠Put a proper value on the reserves.
A reserve dollar isn’t free. But it also has value.

Estimate how much Ghana saves in borrowing costs and crisis risk from having an additional dollar of reserves. Then calculate how much it costs to obtain that dollar through GoldBod versus simply acquiring foreign exchange through other means.

The difference is effectively the price of the policy.

You may not get a clean answer. That’s fine.

But perhaps the most interesting output could be this:

What would the environmental cost per ounce of gold have to be for the GoldBod model to break even?

That is a question I haven’t seen anyone properly answer.