Global commodity price slump bites Ghana’s economy – Finance Minister

The continued slump in global commodity prices has been biting off a chunk of Ghana’s revenue accruing from the export of its commodities, especially in the extractive sector, Mona Quartey, Deputy Minister of Finance, declared here on Wednesday.

Mrs Mona Helen Quartey, Deputy Minister of Finance
Mrs Mona Helen Quartey, Deputy Minister of Finance

The government will, for that matter, adopt measures to ensure prudent management of the revenue so they are utilized in a way to benefit Ghanaians.

Mrs Mona Helen Quartey, Deputy Minister of Finance
Mrs Mona Helen Quartey, Deputy Minister of Finance

Quartey made this remark in his message during the launch of the 2014 Ghana Extractive Industry Transparency Initiative (GHEITI) reports on mining as well as the oil and gas sectors.
Mining contribution to Ghana’s economy has slumped greatly due to the weak global commodity prices.

The sector’s contribution to Ghana’s total revenue fell from 27 percent in 2012 to 19 percent in 2013 and further down to 16 percent in 2014, according to official data.

To protect Ghana’s earnings from the extractive industry, the deputy minister disclosed the intention of government to implement the new EITI standard which requires that Ghana agreed on a road map to establish a Beneficial Ownership Register by January 1, 2017, and publish the Beneficial Ownership of Companies by January 1, 2020.

“The implications of lack of Beneficial Ownership disclosures in the country can lead to information gaps that allow financial corruption, transactional crime and tax evasion to flourish,” Quartey pointed out.

She was of the belief that the establishment of the register would reduce or eliminate the misuse of corporate vehicles such as partnerships , companies, trusts and other types of legal persons to dabble in money laundering, insider dealings., tax fraud, transfer pricing, trade mispricing and other illicit activities.

“The establishment of the Beneficial Ownership register in the country will therefore reveal the flesh-and-blood owner of corporate entities and may reduce the potential for companies to engage in illegal activities,” she added.

The deputy minister said the fall in global oil prices which hovers around 40 U.S. dollars per barrel on the world market also had both risks and opportunities for the country, hence the need for prudent fiscal management.

Further, she said government would not only ensure that the allocation of revenues best promoted sustainable development, but also would ensure that the extractive and natural resource-based activities were fully integrated into community development planning to maximize their contribution to sustainable livelihoods.

In his message, the Chief Executive Officer (CEO) of the Ghana Chamber of Mines, Sulemanu Koney, lamented that the development imbalance between host mining communities and non-mining communities continued to persist.

“In this regard, the Chamber of Mines and its members urge the state to expend fiscal receipts from the mining sector in a more sustainable manner,” he added.

He said mineral revenues should be managed along the lines of the provisions of the Petroleum Revenue Management Act (APRM), Act 815, adding : “Such a legislation will enhance transparency in the utilization and management of mineral revenue for the benefit of the good people of Ghana and generations yet unborn.” Enditem.

Source: Xinhua

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