Ghana announces plan to buy oil with gold instead of dollars.
The Ghanaian government revealed on Thursday that it would purchase oil goods using gold rather than its dollar reserves.
The measure, according to Ghana’s Vice President Mahamudu Bawumia, is intended to address the country’s declining foreign exchange reserves as well as the demand for dollars from oil importers, both of which are weakening the local cedi and driving up living expenses.
The move “would fundamentally affect our balance of payments and greatly minimize the chronic depreciation of our currency,” according to Mr. Bawumia, assuming it is implemented as scheduled for the first quarter of 2023.
He continued by saying that since domestic vendors would no longer require foreign exchange to import oil items, adopting gold would prevent the exchange rate from having a direct impact on the price of fuel or utilities.
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