GoldBod
A debate over reported losses by the Ghana Gold Board (GoldBod) has sparked questions about how the government’s domestic gold purchase programme operates.
In an attempt to simplify the issue for the ordinary Ghanaian, mining consultant and engineer Kenneth Bansah has used a familiar ‘koobi’ buying-and-selling analogy to explain why reported financial losses should not necessarily be interpreted as losses from GoldBod’s core operations.
Below is the full write-up:
Did GoldBod make the reported Losses? Let Atanfo Ny3 Nyame Explain
When this issue of GoldBod started rearing its head, we came out clearly that the IMF report did not state anywhere that GoldBod was making losses. The issue is purely a misunderstanding of how the programs and GoldBod’s mandate operate in the domestic gold purchase program.
Let me emphasize that the IMF report that has constantly been cited to confuse many did not state that GoldBod is making losses. Perhaps, people have not read the report themselves and are running with whatever they hear.
Let us make the whole issue simple for the understanding of everyone.
Atanfo Ny3 Nyame is committing to use himself for illustration. As a reminder, Atanfo Ny3 Nyame works in a mine in Ghana. His salary is quoted in US dollars but paid in the cedi equivalent every month.
Back to the issue.
Atanfo Ny3 Nyame decides to buy koobi to sell and keep some. He wants to keep some for future use and only sell when necessary.
Atanfo Ny3 Nyame cannot go and buy the koobi himself, so he asks his colleague’s son, Nyansa Wo Fie, to help him.
Atanfo Ny3 Nyame gives Nyansa Wo Fie GHS1,000 to go and get him koobi. Nyansa Wo Fie goes to the market, purchases the koobi, and brings it to Atanfo Ny3 Nyame.
Nyansa Wo Fie gets paid for running the errand. His work is done. But the more koobi he buys, the more he gets paid by Atanfo Ny3 Nyame.
Atanfo Ny3 Nyame ships some of the koobi to Accra for sale and also keeps some as originally intended. Sometimes, the price of koobi changes during transportation, so he does not sell at the rate he originally planned.
Do we blame Nyansa Wo Fie if Atanfo Ny3 Nyame loses due to price changes?
Atanfo Ny3 Nyame will be back to explain further and offer more information on whether he is truly losing or not, considering the overall objective of his business plan and strategy.
Kenneth Bansah, PhD, PE
