Ghana wants to buy oil with gold instead of dollars

Gold instead of dollars

Gold instead of dollars, The government of the West African country of Ghana is working on a plan to buy fuel with gold instead of US dollars as foreign currency reserves. The country’s vice president, Mahamudu Bawumia, announced the plan in a post on Facebook last Thursday. Al-Jazeera news

Gold instead of dollars

The global economy is in a recession

Demand for the dollar, used as an international exchange currency, has also increased. Especially in countries that have to import fuel, dollar reserves are constantly decreasing. Added to this is high inflation. In such a situation, Ghana announced this plan to overcome the dollar crisis.

There is a dollar crisis in Ghana:

A poor country in Africa. According to the government, the country had $9.7 billion in reserves at the end of 2021. As of last September, the total foreign exchange reserves were down to about $6.6 billion. With these dollars in hand, the country will be able to pay its import expenses for three months.

In such a situation, Ghana is planning to pay the price of imported fuel with gold from the beginning of 2023. Vice President Mahamudu Bawumia said, ‘The new policy taken by the government will change our exchange system. This will reduce the continuous devaluation of the domestic currency.

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Explaining this, Bawumia said, “If oil is imported with gold, the currency exchange rate will not directly affect the energy bill.” Because domestic sellers will not need foreign currency to import oil or oil products. Importing oil with gold will bring about structural changes in the exchange system.

There are oil fields in Ghana:

The country produces crude oil. But cannot refine to use. Ghana has been in this problem since 2017. That year, a major explosion shut down an oil refinery in the country. It was the country’s only fuel oil refinery.

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