Olivia
Online
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@notf1oyd
Accra, Ghana
Joined October 2021
31 Following
9 Followers
104 Posts
this is also a reminder that we should all be building something. especially here in africa. no excuse to not try at the very least.
strong reminder that the most valuable skill to possess in this modern era, is humanity.
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1. Analysts like @CallmeAlfredo have been talking and writing about GoldBod for more than a year. On these streets, we have dissected and trisected every aspect of the issue.
2. All of a sudden, politicians jump into the fray, stay strictly on the surface, add no new insights, and the whole country is immediately agog as if the Ark of Covenant has been found...at Achiase.
3. People now start coming to my page asking me why "I am not talking about GoldBod." Seriously?
4. Seriously, Ghanafou?
5. So, if politicians don't move national debate, you won't be interested? You won't read what independent analysts write for your own education unless there is a political controversy?
6. When I complain about Katanomics (the inability of POLICY to compete with POLITICS in Africa, leading to shallow solutions that keep the same problems recurring without any "learning"), this situation right here is the perfect example.
7. Naturally, I wasn't going to rehash the plenty explanations and analysis of the last one year, but reading some of the questions I keep getting, I think there is one specific aspect of the affair that most people simply don't get and if they did they would be in a better position to educate themselves about the rest of the issues.
(In this post, my goal is to really simplify, which carries the risk of oversimplification. You will see that even a simple explanation is much too long for this format, so further simplification is impossible. Anyone looking for "sophisticated" analysis can read any of the dozen articles written on the subject.)
Here goes:
8. Most people accept (except die hard motivated reasoning party fanatics) that over the course of 2025, GoldBod bought roughly $10 billion of gold but the Bank of Ghana received value for about $8.3bn. Some prefer to call this "costs" and others "losses."
9. The only reason, in my view, why objective people are confused is because of how the costs and benefits of the entire state-run gold trading scheme have been defined. People have been led to the impression that GoldBod *GENERATED* $10bn worth of dollars in 2025.
9. Put another way: that somehow without GoldBod $10 billion wouldn't have come into Ghana. In that sense even if Ghana lost/spent $1.7bn, the country has still benefitted enormously. This is shallow analysis. And it is the one confusion most worth clearing up.
10. GoldBod doesn't produce gold. GoldBod doesn't invest in gold production. It hopes to get there someday but it is not there yet.
11. The gold we are talking about was produced, mostly, by small-scale Ghanaian mining operators. We believe that this includes both legal and illegal (galamsey) producers but that is another discussion for another day. These miners were the ones who invested to produce the gold.
12. Would they have produced $10bn of gold without GoldBod? Would $8.3bn have come into Ghana? If the answer is "yes" to any of these questions, then GoldBod is a waste of money because we are paying them for adding no value (they charged the country through BoG about GHS 558 million for their services).
13. If the answer is "no", then the question becomes: how much would the small-scale mines have produced and how much of the resulting "gold dollars" would have come to Ghana? GoldBod's contribution is the DIFFERENCE between $8.3 billion and whatever number pops out from that analysis. Clear?
14. So, say, you argue that without GoldBod, Ghanaian miners would have produced $7bn and brought in $6bn (due to "leakages", which we will discuss later), then GoldBod's value to Ghana is between $1.3bn and $2.3bn. The question is: what is the actual number?
15. That is where the REALLY SERIOUS debate had been about until the politicians came and sucked all the oxygen from the room. They succeeded because politics is a masses business and policy is an elite business. Mass media will always be dominated by what the masses engage with. ("Elite" as used here does not connote superiority, only "social division of responsibility".) Until we find a way to link politics and policy in Africa more effectively, we are doomed. That is the task the Katanomics Society (www dot katanomics dot org) exists to confront.
16. Going back to the analysis, note that gold producers are business people. They will produce gold without prompting if there is a ready market for it, and there is. They have always had a way to sell that gold and they don't get any investment from GoldBod, so most of us can agree that the production of gold has little to do with GoldBod. The real controversy then is about how much of the gold dollars would have come to Ghana. And this raises two issues: smuggling and leakage.
18. Some of us argue that smuggling doesn't necessarily lead to much leakage. If Ghanaian gold producers sell as close to the international market price as possible in Cedis to Lebanese, Indian, or Chinese smugglers, then even if those people take the gold away to sell in dollars, those dollars won't be entirely lost to the Ghanaian economy. This may sound scandalous. But keep your shirt on, and continue reading.
19. Firstly, we have to be sure about the scale of smuggling and why people do it. I have argued elsewhere that those who do it to evade broader taxes (such as corporate and personal income taxes) have such a huge incentive that nothing will stop them. Which is why, even with GoldBod, we still have smuggling. But let's for now assume a kind of smuggling that can truly be stopped by GoldBod following passage of laws that have stopped all formerly legal exporters from exporting.
20. The key insight I want to leave you with is that even Smugglers still need to convert MOST of the gold dollars they get from smuggling gold abroad back into Cedis to keep buying the gold locally to smuggle outside. What they keep is their profit, which is the margin between what Ghanaian gold producers sell the gold to them for and the international market price. In a highly competitive market, that margin will drop to as low as possible. It definitely won't be the 17% that the new model loses. It will very likely not exceed 3%.
21. That means that the gold dollars will still come into the economy (minus profits of the smugglers) but it won't go to the Bank of Ghana. It will go to commercial banks and Aboki. That is another competitive market that will allot the dollars due to the real demand in the economy.
22. Nonetheless, let us accept that such an outcome doesn't sit well with you as a law-abiding Ghanaian. And you just feel that the gold dollars are best allocated by an omniscient, all-wise, Bank of Ghana. The truth is that the Bank of Ghana will still sell back into the market for people that need dollars. Whatever route gold dollars take, they end up in the same commercial market.
23. The only caveat, therefore, is that the GoldBod model routes most of the dollars through the Bank of Ghana, which grants BoG the choice to set a lower price for the dollars than the market may have done. That is what they mean when they say most of the losses are due to "exchange rate" losses. The whole GoldBod - BoG system is tightly connected to allow BoG to set dollar prices lower than normal demand and supply would have permitted. It is this "benefit" of GoldBod and the previous Domestic Gold Purchasing Programs (DGPP) that must be carefully valued.
24. How does one value this GoldBod role? This power it has given to the Bank of Ghana to subsidise the dollar rate? Is it worth $1.7bn? Obviously, it is much harder to analyse than the crude way we began with (by assuming the entire $8.3bn was some kind of bonanza from GoldBod). Now let me tell you the problem some of us have with this GoldBod "benefit".
25. The price of gold has more than doubled since 2021 (in both 2021 and 2022, average prices hovered around $1800 versus over $4500 today). For the same investment Ghanaian gold miners/producers would have made in 2021, the country gets twice the amount of dollars. Nothing whatsoever to do with GoldBod.
26. Supposing we were producing the same quantity of gold in 2021 from the small scale and artisanal sector. as we are doing today. The country would have received $5bn then. Now, for roughly the same underlying investment, it gets $10bn. That is $5bn extra "PROFIT". In such an arrangement, even if we create an inefficient bureaucracy that leads to $1.7bn in losses, we are still left with $3.3 billion more than we would have received before. Because the strength of the Cedi is roughly determined by the amount of dollars in circulation, the massive increase in gold prices will always benefit the country whether or not there is a GoldBod.
27. Study the attached graphs carefully. They show you historic episodes when Ghana enjoyed relative stability of the Cedi. They also show how external factors such as commodity prices have historically shaped the domestic experience of exchange rates and cost of living. Comparing Ghana's situation with peers across Africa, it is evident that the benign external environment of recent months (including unorthodox policies in the US that are weakening the dollar and boosting precious mineral prices) is not getting sufficient attention in Ghana.
28. The problem is what happens when that external picture and the positive cyclical trends change for the worse. What happens if Ghana's dollar flow halves because prices drop by 50%? Where would the government now hide the $1.7bn "losses" or "costs"?
29. Especially when the need to subsidise the cedi rate becomes even more intense precisely when the currency is under pressure.
30. That is why despite all the spin and confusion, the Bank of Ghana admits that there is a problem building up for the country. And has thus stopped directly funding the purchases of gold and is pushing for losses/costs to come down to 5%. Can it succeed?
31. This is where the Minority's push for transparency is useful. Without detailed modelling of the loss drivers, we can't be confident that the BoG-GoldBod alliance can. Let's look at the main risks one after the other.
32. The "exchange rate loss" component of the whole setup depends on how aggressively the Bank of Ghana intends to continue subsidising the Cedi. We need to have an honest conversation about that. What should the right Cedi - dollar rate band be?
33. The loss from paying miners very close to the international price (leaving too little a margin for other costs) is set by a simple decision of how much smuggling we are willing to tolerate.
34. And the loss from selling the gold at a price significantly lower than the international market rate is driven by good governance. Right now the system is opaque and no one except BoG and GoldBod knows if all buyers are getting the same deal and on the same basis. It is easily abused. The Minority in Parliament is absolutely correct that we must force GoldBod and the BoG to disclose all the offtake contracts from the dawn of the programs.
35. Like I said, so long as the price of gold stay well above $3000, there will always be room to absorb considerable policy inefficiencies. Should it start to drop well below $4000 wahala will gas! Knowing what I know about Ghana, I think we will just wait and see before any serious national consensus will build.
36. Each of the points above deserves its own 5000 word article. Yes, policy is damn hard both to think through right and to do right! Which is why without enough citizens being interested in pushing it, politics will always win and the katanomic condition will prevail.
37. I hope though that having read to this point, you now understand why some of us can't participate in shallow debates.
38. And the issue of whether or not the gold trading losses (shared jointly by GoldBod and BoG because they both set prices and impact volume decisions) are a problem is now much clearer to you now than before.
39. If you want even more emphatic and sophisticated analysis than this introductory one, you just need to spare 30 minutes and read the pieces I am attaching to this thread. And of course, pay attention to the attachments.
40. Keep faith with Ghana but never stop asking hard questions and thinking deeper beneath the surface. That is how we will bring down katanomics!
That DDEP coupon payment mixed with the sharp cedi appreciation really dragged down interest rates across the money market. So much cedi liquidity + a strong currency = high demand for cedi denominated assets. Stocks should feel a positive spillover as well.
Merck and Moderna announced positive results from a large late-stage trial of their personalized mRNA cancer vaccine, which significantly reduced the recurrence of melanoma, the deadliest form of skin cancer.
Madison Muller reports https://t.co/STNA694PEU
Matthew 6:33 is my guide to life.
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The IMF Board has just completed the sixth and final review of Ghana’s 39-month ECF program, making way for a disbursement of $371 million. End of a chapter.
Highlights: 131st MPC Meetings Press Briefing.
'Businesses need patient, long-term capital to expand.'
Absa Bank Ghana’s Head of Trading, Global Markets, Andrews Akoto, says Ghanaian businesses must explore the capital market as an alternative source of funding beyond traditional bank loans.
📺 Watch here: https://t.co/JMdatNHzge
#QuarterlyEconomicOutlook #ChannelOneTV #ChannelOneNews #GhanaNews #Economy #Business #CapitalMarket
As AI tools become more widespread, the advantage shifts toward those who work hard, think critically, communicate clearly, and apply emotional intelligence effectively.
AI was never going to replace human capacity across the workforce, especially not as the cheaper option. The technology scales rapidly, but fortunately/unfortunately, so do the costs of building, maintaining, and governing it.
In IB, models, pitch books, and due diligence can all be accelerated and ameliorated by AI. However, winning mandates has never been about who can build the best model. It is about trust, relationships, judgment, and convincing a CEO or board to act on your advice.
1. A major news channel in Ghana says there is a ruckus in the Bank of Ghana (BoG) board. One faction wants the BoG's swanky/controversial new HQ sold to a lucky real estate company and leased back at a juicy rate.
2. Apparently, a shrewd financier hopes to get bank financing for the whole gig.
3. Another faction is up in arms and is the one behind the leak.
4. Be that as it may, the BoG furiously disputes the news report. It says that such reports are, wait for it, dangerous because they have the potential to undermine public confidence in the BoG.
5. The BoG says that it "remains committed to transparency and will continue to engage stakeholders through its official channels."
6. Howzat?
7. In March 2025, the BoG told Parliament that it had tasked AESL to undertake a value for money audit into the HQ project. 15 months onwards, it simply REFUSES to publish the audit report.
8. Which is a serious problem because the costs of that giant edifice are a total blackbox and the whole project has been a masterpiece of opacity. Let me jog some memories.
9. BoG's Board took the decision to initiate the project in Dec 2019. The allocated budget was ~$100m. The procurement authority approved ~$81.9m. After the restricted tender was won by the contractor, the budget was suddenly jacked up to $121m. The BoG Board finally settled on $222.8m with the contractor.
10. But as I hinted earlier, the project is actually in the range of $600m if we are to be strict about the numbers.
11. In Feb 2025:
- $230m had been paid to the contractor.
- $31.8m was owed to the contractor.
- $8.6m was earmarked for a separate ICT contract.
- $15.8m was earmarked for integrated electronic security systems.
- $11.1m was earmarked for furniture & furnishings
- $48m was allocated for taxes & levies.
12. That is $345m, I lie?
13. Well, the original design that was costed for the clearly discredited tender at $100m included a bunch of things that the $345m hasn't delivered. And remember that the earmarked allocations were merely on budget. If cost overruns are just 2x, how much really are we talking about?
14. Here are the original design items that are yet to be delivered. According to the BoG, "grey boxes" have been provided for them to be added later:
- Data Center
- Currency Processing Center (no accounting, by the way, for the underserviced De La Rue-provisioned system),
- Specialised Security System
- Still not clear if the helipad is fully functional
15. Now, let's add the piece everyone forgets: the prime land!
16. The BoG acquired the West Ridge/SIC land by compulsory acquisition through E.I. 304. The going rate in that prime area is easily $1500 per sq m. BoG doubled the acreage of Bank Square from 73,000 sqm to nearly 150,000 sq m. That is $225m of prime land!
17. In short, this is a $600 million (& counting) project that has katanomically been hoisted as a massive success because of zero policy accountability.
18. What continues to fascinate me is how well katanomics explains this opacity (with elite complicity) and lack of policy accountability in a democracy as vibrant as Ghana.
1. A major news channel in Ghana says there is a ruckus in the Bank of Ghana (BoG) board. One faction wants the BoG's swanky/controversial new HQ sold to a lucky real estate company and leased back at a juicy rate.
2. Apparently, a shrewd financier hopes to get bank financing for the whole gig.
3. Another faction is up in arms and is the one behind the leak.
4. Be that as it may, the BoG furiously disputes the news report. It says that such reports are, wait for it, dangerous because they have the potential to undermine public confidence in the BoG.
5. The BoG says that it "remains committed to transparency and will continue to engage stakeholders through its official channels."
6. Howzat?
7. In March 2025, the BoG told Parliament that it had tasked AESL to undertake a value for money audit into the HQ project. 15 months onwards, it simply REFUSES to publish the audit report.
8. Which is a serious problem because the costs of that giant edifice are a total blackbox and the whole project has been a masterpiece of opacity. Let me jog some memories.
9. BoG's Board took the decision to initiate the project in Dec 2019. The allocated budget was ~$100m. The procurement authority approved ~$81.9m. After the restricted tender was won by the contractor, the budget was suddenly jacked up to $121m. The BoG Board finally settled on $222.8m with the contractor.
10. But as I hinted earlier, the project is actually in the range of $600m if we are to be strict about the numbers.
11. In Feb 2025:
- $230m had been paid to the contractor.
- $31.8m was owed to the contractor.
- $8.6m was earmarked for a separate ICT contract.
- $15.8m was earmarked for integrated electronic security systems.
- $11.1m was earmarked for furniture & furnishings
- $48m was allocated for taxes & levies.
12. That is $345m, I lie?
13. Well, the original design that was costed for the clearly discredited tender at $100m included a bunch of things that the $345m hasn't delivered. And remember that the earmarked allocations were merely on budget. If cost overruns are just 2x, how much really are we talking about?
14. Here are the original design items that are yet to be delivered. According to the BoG, "grey boxes" have been provided for them to be added later:
- Data Center
- Currency Processing Center (no accounting, by the way, for the underserviced De La Rue-provisioned system),
- Specialised Security System
- Still not clear if the helipad is fully functional
15. Now, let's add the piece everyone forgets: the prime land!
16. The BoG acquired the West Ridge/SIC land by compulsory acquisition through E.I. 304. The going rate in that prime area is easily $1500 per sq m. BoG doubled the acreage of Bank Square from 73,000 sqm to nearly 150,000 sq m. That is $225m of prime land!
17. In short, this is a $600 million (& counting) project that has katanomically been hoisted as a massive success because of zero policy accountability.
18. What continues to fascinate me is how well katanomics explains this opacity (with elite complicity) and lack of policy accountability in a democracy as vibrant as Ghana.
1. Let's talk about "Ghana taking control of its minerals".
2. But let's go beyond the usual katanomics and debate the HOW too.
3. There is a nationalist wave blowing all over the world. The terms may be fancy - "strategic autonomy," "geopolitical decoupling," "near-shoring", or "deglobalisation" - but same sentiment
4. "Economic nationalism" is sexy again. Why else would market-friendly Chile seek to nationalise its lithium?
5. But is the Ghana version really about "nationalism?"
6. Folks don't talk about ownership of banks & telcos anymore. Have the bruises of the last few decades made Ghanaians comfortable with "foreign banks" and "foreign telcos"?
7. There is talk of a "national airline" again, though. After two disastrous runs and a decade-long process that led nowhere.
8. Where I see absolute clarity is in the gold sector. Ghanaians want "Ghana to take control" of the country's gold mines.
9. There is a reason the focus is on gold. Discussions in Ghana are almost always about the VISIBLE. Gold is booming so time to cash in. The chattering elites rarely bother to look beneath the surface.
10. So, either they don't know or they have forgotten that there are other minerals in the country.
11. In the case of diamonds, Ghanaian elites have largely been in charge for at least 5 decades. The result is massive underinvestment and the collapse of the sector.
12. In the case of manganese, lithium, & bauxite, foreign control and lack of accountability have happened with the enthusiastic abetment of the elite. (Read some of the stuff I have written in the first comment.)
13. Everyone also conveniently forget that even for gold, we now have 50% of production in the hands of Ghanaians. Small-scale mining is restricted to Ghanaians.
14. So, if Ghana has not been able to use resources from mining to transform, the biggest reason must be because of POOR POLICY. End of story.
15. The recent attempt to paint the handover of mines to a few, highly connected, people as some kind of "resource nationalism" is just the standard katanomic shallowness.
16. Yes, ownership matters but "collective ownership" is not just about the nationality of a few individuals holding lease rights. It goes far beyond that.
17. Because, for all you know, such individuals can send most of the profits overseas and leave the wreckage behind for us: bank loan defaults, employee impoverishment, lack of R&D, environmental damage, and failure to grow reserves through exploration.
18. The world's most mineral-rich country per capita is Australia (with Russia, Canada, Saudi, & the US on its heels). If you analyse Australia's biggest mining projects over a two decade period, you will see that 85% - 90% are by foreign investors.
19. I also did the same for critical minerals in Europe's most mineral-rich countries (eg Germany, Sweden & Poland). Same thing.
20. Still, they ensure that the minerals BENEFIT the citizens. That is what ultimately collective ownership delivers.
Three interesting things:
1. BoG is paying GHS 16.7bn (2024: 8.6bn) in interest on the securities it issued and earning GHS 8.5bn (GHS 7.5bn) in interest on securities it holds. This reflects the cost of absorbing liquidity in the market as yields on other instruments collapse.
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There is a direct link between effort and outcome, between discipline and freedom. To abandon that in pursuit of constant ease is to lose more than productivity. It is to lose agency. The call is to stay sharp, stay disciplined, and fight for your mind.
Something feels off about the way we live now. Everything is faster, ‘easier’, more convenient and yet we are thinking less, creating less, building less. That is not accidental.
Scripture is clear about the importance of work and discipline. “The one who is unwilling to work shall not eat” (2 Thessalonians 3:10, NIV). “The plans of the diligent lead surely to abundance” (Proverbs 21:5, NIV). These are instructions for how a life is built with depth.
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