An interim report issued by the Ghana Chamber of Mines stated here on Thursday that Ghana earns far lower than it potentially should have from the mining sector.
Last year, Ghana earned 4.5 billion dollars from mineral exports, representing a 10 percent decrease in the 2013 earnings of 5 billion U.S. dollars.
Out of this, direct benefit to government was from royalties of an average of 5 percent and carrying interest averaging 10 percent together with corporate income tax and employee income tax.
According to the report, the country needs deliberate policy measures and implementation to ensure that the country earns its deserved returns from the sector.
The study, conducted by Steward Redqueen, a Netherlands-based consultancy, and the African Center for Economic Transformation (ACET), a Ghana-based economic think tank, demonstrates that the Ghanaian mining industry currently faces declining grades and lower gold prices.
This, it said, would affect company revenues, employment, social investment and related service industries over time.
The study, which looks at the prospects of the benefits of mining to Ghana’s economy from 2010 -2022, covers production levels, capital investment, tax payments, employment, procurement and community spending over a forward-looking timeframe.
It is designed to contribute to more broad-based economic and social development in Ghana through objective projections based on the current gold price.
Among the findings for the sample of mining companies, it estimates that, in the period 2010-2022, on average 110,000 people are employed directly and indirectly annually; and for every one job at a mining company, 17 additional jobs are created indirectly.
Rene Kima, partner in Steward Redqueen, who presented the findings to the media, said there was a lot more that could have been done along the value chain of mining to benefit Ghanaians.
Kima argued that although local procurement had benefitted from the mining sector, a lot more could have been gained if the value chain had developed such that a lot more procurement could have been done internally.
“For example, in the textiles sector, mining firms should be able to procure their garments from local manufacturers. Ghana must use the presence of the mining sector to diversify the economy and develop skills sets,” he urged.
According to him, there are various opportunities that Ghana would derive from the mining sector if skills that were needed to derive those benefits were developed.
He said the study showed that there was no urge to develop a critical skills set using the advantage of the mining sector, adding that “the urge ought to be created to develop a local skills set.”
Sulemanu Koney, chief executive officer (CEO) of the Ghana Chamber of Mines, said there was the need for Ghana to take stock of the sector’s performance to deepen its impact on the economy.
The study sampled a number of companies representing 71 percent of large- scale mining in Ghana using actual data up to 2013 while making projections from 2014 onward. Enditem
Source: Xinhua
