My perspective on the exploitation of mineral resources in Ghana/Africa

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“Nobody owes us a living. We can’t live by the begging bowl.” Lee Kuan Yew.

Ghana is endowed with great natural minerals like gold, diamond, manganese, bauxite, salt, clay, limestone, kaolin, feldspar, lithium, iron ore, bentonite, silica, oil and gas, etc. But did you know that the commercial exploitation of all these minerals for over 150 years hasn’t helped much?

Recent reports indicate that 98.3% of Ghana’s gold is owned by foreign companies in the United States, Britain and Canada. The oil and gas sector is dominated by European and American oil companies holding a high percentage of stakes, with Ghana holding between 10-20% as the true owners of the resources. What a pathetic situation!

When Dr. Kwame Nkrumah nationalized all gold mines after independence, he was overthrown in a coup orchestrated by America’s Central Intelligence Agency (CIA). Later they sent the Bretton Woods institutions, the World Bank and the International Monetary Fund (IMF) and the International Finance Corporation (IFC) to force Ghana to pledge all its gold as a condition precedent to any loan and deal. commercial. They then introduced economic stimulus policies and the Structural Adjustment Program (SAP) and brought in multinational mining companies and conglomerates in the name of Foreign Direct Investment (FDI). This has opened the doors for predation, plunder and plunder of the natural resources of Ghana and Africa.

Gold is one of the most strategic precious metals in the world. Ghana, as a colony of Britain and under the supervision of the US-controlled IMF and World Bank, was no longer allowed to nationalize its gold mines and use the gold to support the stability of its currency. Instead, the government was preoccupied and dependent on crumbs: loans, grants. , handouts, handouts and giveaways until all of its mineral resources and concessions have been taken over by foreign companies, giving Ghana a paltry 10-20% stake in most deals.

It has been the scourge of Ghana and Africa for all these decades. Indeed, the dice were cast. Things really fell apart and the center couldn’t hold up to this day. The country continues this hydra-headed journey. When would this end? When would Ghana take absolute control of its natural resources and reap the revenues necessary for its socio-economic development?

Someone once asked me, “What is the solution to Ghana’s and Africa’s resource curse?” My response was quick and instantaneous: “Repeal all mining contracts and renegotiate them on at least 50-50 shares of ALL signed mining agreements. If foreign companies refuse to comply, fire them all” . Someone would ask me if I know about judgment debt. And my answer is yes!

I believe that response was harsh and would receive the highest condemnation from some quarters, but who cares! Only the late Colonel Muamar Gaddafi was able to do this for his country’s oil and he got the revenue to develop Libya. Botswana also managed to get a good mining law for its diamond sector and has done extremely well ever since. Ghana missed all of that. Ghana’s mining laws are so weak when it comes to tax regime that they have been disadvantaged in the mining sector when it comes to revenue generated.

In a seminal book by Tom Burgis called “The Looting Machine”, he listed almost all such instances in African countries. A very sad and painful situation in the governance of resources in Africa during all these decades of exploitation.

Look at the following figures and you will understand why things have to change now.

For example, Zambia receives about 2.4% of all mining revenue. DR Congo receives around 2.5%. And Ghana collects about 7% including 3% in royalties, taxes and dividends. This is the case in all regions of Africa and Latin America with very few exceptions, particularly in the oil and gas sector where many countries have adopted production sharing agreements.

In 2009, when Dr Kwabena Duffuor, then Minister of Finance, wanted to raise Ghana’s royalties on mining contracts from 3% to 6%, it prompted stark warnings and accusations from mining companies about the resurgence of the “resource nationalism”. A mining company official hinted about the said royalty increase that “our investment agreement supersedes the mining laws of Ghana.” This increase never took place. Sad indeed!

Again, Niger, one of the main uranium exporting countries, earns more money from the export of onions than from its total revenue from uranium exports. It receives less than 5% of all the uranium mined in the country. French mining company AREVA has been mining uranium to power its nuclear power plants in France for decades to fuel its economy and development, but Niger languishes in abject poverty, almost always ranking at the bottom of the least developed countries ( PMA) as well as the Human Development Index (HDI) Ranking. Our current leaders across Africa must stand up and fight with a common purpose and approach.

Excerpts from The Looting Machine by Tom Burgis, pp. 163-165, 135.

What a resource curse! It is the looting, looting and predation of African resources since the memory of time. Ghana must wake up! Africa must rise! This must stop NOW!

Joel Degue
Resource Development Advisor
(+233 242501638/[email protected])

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