15% stake in mining contracts not benefitting economy enough

Deputy Minister Mr. Mireku Duker in a photograph with executives of GMWU

Chairman of the Ghana Mines Workers Union (GMWU), Kwarku Mensah Gyakari, has called on the government to consider negotiating bigger interests in mining contracts than exists now if the country is desirous of creating more value from the commodities extracted for Ghanaians.

Despite Ghana being a leading gold producer with several decades of experience in the extractives industry, its stake in almost all mining companies in the country currently remains around 10 to 15 percent (carried interest).

According to Mr. Mensah Gyakari: “If mining is to remain relevant to our course as a nation, it will all depend on how we strategically position ourselves to take full advantage of the opportunity that the industry presents”.

This, he observed, cannot be realised by solely depending on mining tax and royalties.

“There is an urgent need to create value and ensure we retain that value for the greater good of this country and its citizens,” he added.

Among the requirement to do this, he noted, is to build capacity; therefore making local participation in the mining industry crucial.

“It is important that we take the commanding heights of the mining industry.

It is against this background that he opined the country must endeavour to shift from the formula of negotiating mining contracts which retain only a 10 to 15 percent stake, and consider the possibility of negotiating a better arrangement beyond the prevailing situation.

“That is the only way we can create value for this country and its citizens,” he stressed while speaking at a meeting of the GMWU leadership with the Deputy Minister for Lands and Natural Resources, Mr. George Mireku Duker.

“As a Union, we believe that after over 100 years of mining it is extremely sad that we are only left to scramble for the downstream opportunities which mining presents. This narrative ought to change,” he said.

Furthermore, he asserted that it is not befitting to only leave contract mining and exploration activities to Ghanaians – insisting that Ghanaians must be actively involved in the core business of mining and processing.

He therefore urged government to create some opportunities for renegotiating a reasonable percentage of the stake in existing mining contracts, while looking forward to future contracts being better negotiated.

The meeting was to deepen collaboration with the Union as government pursues mining companies in the country to deepen their local content policies.

The Deputy Minister for Lands and Natural Resources, on his part, said government has already engaged the companies on this, and assured them that everything will be done for the companies comply with the directive.

“We wouldn’t want a situation where the mine or concessionaire will elapse their mining life and get away without giving hard-working Ghanaians what they are due.”

Mr. Duker further explained that local content is not only about welfare but also about making available part of their concessions to Ghanaian workers by way of outsourcing some production activities and technological advancements, among others.

He acknowledged the petition of the Union about some of its members’ challenges regarding disparities in remuneration as compared with that of expats – further commending the Union for addressing their grievance appropriately through the right quarters.

The ministry, he assured, will continue to work with relevant bodies to ensure that mine workers are given their due.

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