Ghana’s new mineral income investment law is a good one that sets the tone for some changes in the mining sector, an analyst said on Tuesday.
In a two-day discussion initiated by the Ghana Chamber of Mines, Emmanuel Kuyole, Executive Director for Center for Extractives and Development Africa (CEDA) said the Minerals Income and Investments Fund (MIIF) Act passed last December was one that promised to bring transformation in the development in the country.
Among other things the MIIF Act seeks to use the Minerals Development Fund (MDF) as a special purpose vehicle to raise funding for development in health, education, economic and other sectors.
“It is a game changer because government can go on the back of the MDF as stated in the MIIF Act to seek financing for the development initiatives it wants to undertake,” Kuyole explained.
Previously Ghana’s mineral royalties went into the consolidated fund, where 80 percent was retained and 20 percent was disbursed to the MDF. Under the new law, the whole of mineral royalties will be lodged in the MIIF where part of it will be disbursed into the consolidated fund and other statutory funds stipulated under the law.
“Ghana can collateralize the mineral revenue going into the future on the back of the MDF and the board of the MIIF also has the powers to approve of such transactions to use the fund as a special purpose vehicle to seek financing for the country’s development,” the analyst explained.
He however urged the government to act as a matter of urgency to appoint the board for the Minerals Development Fund and the Community Development Schemes to ensure accountability.
Deputy Chief Executive Officer of the Minerals Commission, Martin Ayisi said the MIIF, was one that will help Ghana also emulate South Africa in using mining revenue to develop the country.
He said new developments in the mining sector have brought additional need for human resource capacity on the commission. Enditem