Ghana is in talks with the Emirates National Oil Company (ENOC) to arrange a barter deal that would allow the West African country to buy fuel in exchange for gold.
Kebiru Mahama, economic adviser to Vice President Muhammadu Baumea, said the government had reached an “interim” deal with the Dubai oil company.
Ghana, Africa’s second-largest gold producer, ordered big miners last week to sell 20% of the metal it refines to the central bank since Jan. 1 as it builds up reserves of bullion to be used to import fuel and reduce demand. dollars, after its the currency has collapsed by 57% this year.
“We are open to any interested international oil trading company,” Mahama said in a telephone interview on Friday. “Starting next October, all our needs for petroleum products will be exchanged for gold.”
Ghana is struggling to stabilize its economy and sees the barter system as a way to stem a decline in its cedi, the world’s worst-performing currency tracked by Bloomberg.
A weak currency fuels inflation and depletes the country’s foreign exchange reserves. Meanwhile, President Nana Akufo-Addo’s government, which has been unable to access international capital markets this year due to soaring debt and debt service costs, plans to require international bondholders to accept losses on their investments to pave the way for a bailout from the International Monetary Fund.
ENOC did not immediately respond to an email and telephone message requesting comment. The Dubai government, owner of ENOC, did not immediately respond to an email request for comment.