The gold mirage: How galamsey is bankrupting the future

By Winfred Adinortey ASAMANYUAH

Gold has long been Ghana’s pride and economic backbone. As Africa’s top producer and the sixth-largest globally, the country’s golden wealth should guarantee economic resilience and national progress.

Official gold exports strengthen foreign reserves, stabilise the cedi and provide crucial revenues for government spending on infrastructure, health and education.

Yet behind the glitter lies a growing crisis. Illegal small-scale mining, popularly known as galamsey, is eating away at this lifeline. What began as an environmental concern has now evolved into one of Ghana’s gravest financial threats.

Rivers are choked with silt, communities struggle to access clean water, fertile farmlands are destroyed and hospitals are quietly filling with victims of toxic exposure. The state, meanwhile, spends millions that could have gone into development projects just to clean water, import chemicals or cover medical costs.

What appears to be quick profit in ounces of gold is, in truth, a long-term debt; one measured in poisoned rivers, lost food production, rising health bills and weakened economic stability. Galamsey has turned Ghana’s national treasure into a financial trap.

Gold: Ghana’s economic lifeline under threat

Gold accounts for nearly 40 percent of Ghana’s total export earnings, making it the single largest source of foreign exchange. In times of economic uncertainty, gold-backed reserves provide the Bank of Ghana with the leverage to stabilise the cedi and maintain investor confidence. In 2022, Ghana overtook South Africa as the continent’s top gold producer, a milestone that should have been a national triumph.

But galamsey is undermining these gains. Unlike the formal mining sector, which contributes royalties, corporate taxes and jobs, illegal operators siphon gold into black markets.

Smuggling across borders and informal sales drain the state of millions of dollars each year. Instead of boosting reserves, this wealth vanishes into underground economies, leaving the government weaker in the face of inflation, debt pressures and rising import bills.

The paradox is striking: the very resource designed to stabilise Ghana’s economy is being exploited in ways that destabilise it.

Revenue leakages: Gold that never reaches the nation

Estimates suggest Ghana loses billions annually to illegal gold exports. Every ounce smuggled represents not just lost foreign exchange, but also missed taxes, royalties and community development funds. These leakages mean fewer resources for schools, hospitals and roads.

Meanwhile, the black-market gold trade feeds corruption, strengthens criminal networks and reduces transparency in the economy. In financial terms, galamsey robs the country twice: first, through lost revenue; and second, through the future costs of repairing the damage it leaves behind.

The rising cost of water debts

Perhaps, the most evident and expensive evidence of galamsey’s impact is in Ghana’s rivers. Once clear and life-sustaining, they are now muddy streams contaminated with mercury and other toxic chemicals.

The Ghana Water Company Limited (GWCL) has had to allocate much more than its normal budget for water treatment. In places like Konongo, daily treatment costs have risen from about GH₵7,000 to over GH₵80,000.

Chemicals such as alum and chlorine need to be imported in large quantities, increasing costs that are then passed on to households and industries through higher tariffs.

Some treatment plants, such as those on the Pra and Birim rivers, are nearing shutdown because the turbidity is simply too high for purification. When this happens, entire communities lose access to potable water and are forced to rely on sachet or bottled water, draining household budgets. Families that should be investing in food, education or healthcare are now spending significant portions of their income just to drink safely.

The problem extends to industries. Beverage producers, farmers and fisheries that depend on water are compelled to treat their own supply or import alternatives, raising production costs. These higher costs ripple across the economy, hidden in the price of everyday goods such as bread, bottled water, or fish.

This “water debt” also has a generational dimension. Restoring rivers and ecosystems will take decades and billions of cedis. If current trends continue, future governments may face the unthinkable by importing water to sustain Ghana’s cities. A resource that should be abundant and free is being converted into one of the nation’s most expensive liabilities.

Agriculture and food security losses

Galamsey is also undermining Ghana’s agriculture, the second pillar of its economy. Farmlands once fertile with cocoa, rice, maize and vegetables are being destroyed daily as illegal miners dig pits and pollute irrigation systems. Topsoil that takes centuries to form is stripped away in weeks, leaving barren land unfit for cultivation.

Cocoa, in particular, faces an existential threat. Ghana is the world’s second-largest cocoa producer, and the crop not only earns foreign exchange but also sustains the livelihoods of millions of rural households.

Galamsey operations increasingly invade cocoa-growing areas, felling shade trees and contaminating water sources with mercury. If this continues, Ghana risks losing a significant portion of its cocoa output, cutting into export earnings and undermining a sector that has been the pride of the nation for generations.

The food security consequences are already visible. With farmland degraded and water poisoned, crop yields decline. Farmers who lose their land or irrigation are pushed into poverty, forcing some to abandon agriculture altogether. The result is higher food prices, greater reliance on imports and additional strain on foreign reserves.

Worse still, the collapse of farming communities risks fuelling a dangerous cycle. As agriculture fails, some displaced farmers may join galamsey as a desperate alternative, feeding back into the very crisis that destroyed their livelihoods.

What is unfolding is not just an environmental tragedy, but a looming food security emergency with devastating financial implications.

Healthcare bills from toxic gold

The poisons from galamsey are not only killing rivers and farms, but they are also making people sick. Mercury and cyanide used in illegal mining contaminate water and fish, slowly poisoning the populations that depend on them. The health toll is devastating and expensive.

Mercury exposure is linked to kidney failure, neurological disorders and developmental problems in children. Cyanide causes respiratory difficulties, skin diseases and, in severe cases, death. Rural communities often drink and cook with contaminated water without realising the long-term risks until it is too late.

These illnesses are financially crippling. Dialysis for kidney failure costs upwards of GH₵5,000 a month — far beyond the reach of ordinary farmers and traders. Cancer treatment, neurological therapies and chronic disease care drain both household savings and public health budgets. As cases rise, the National Health Insurance Scheme (NHIS) and already overstretched hospitals are forced to bear a growing burden.

The economic impact also comes in lost productivity. Sick farmers cannot till their fields, traders cannot work and families lose breadwinners. Reduced productivity means fewer taxes collected and slower national growth.

Consider Kwame, a 42-year-old farmer from the Western Region. For years, his family relied on a nearby river for drinking water. When his kidneys failed, doctors linked it to mercury contamination from upstream galamsey activities. Unable to afford dialysis, his family sold their land and livestock just to keep him alive. Kwame’s tragedy is shared by many others, a human face to Ghana’s hidden healthcare debt.

Every ounce of illegal gold mined today carries an invisible price tag in future hospital bills and lost lives.

The case for a state of emergency

The galamsey menace has escalated into nothing less than a national emergency. The scale of destruction to water bodies, farmlands and livelihoods is so severe that routine interventions have failed. Temporary bans, half-hearted enforcement and political pledges have not stemmed the tide. What is required now is a bold step: declaring galamsey a state of emergency.

Such a declaration would give government and security agencies the power to act swiftly and decisively. It would enable the protection of critical river basins, the seizure of illegal equipment and the reclamation of degraded lands without bureaucratic delays.

The financial rationale is clear. Every day of inaction costs the country millions in lost revenues, higher treatment costs and declining food production. A state of emergency would also prioritise resources for long-term restoration, ensuring funds are directed to reclaim polluted rivers and support alternative livelihoods for those dependent on galamsey.

Internationally, the move would strengthen Ghana’s case for support. Donors and climate funds are more likely to commit resources if the government demonstrates urgency and seriousness in addressing what is now a national crisis.

Critics may fear political backlash or disruptions to civil liberties, but the greater risk lies in doing nothing. Without decisive intervention, Ghana faces the collapse of its clean water supply, the decline of its cocoa industry and a weakened currency. The costs of inaction far outweigh the risks of extraordinary measures.

Act now or pay later

The evidence is undeniable: galamsey is eroding the foundations of Ghana’s survival. Gold, once a symbol of prosperity, is being turned into a curse that drains the economy, poisons citizens and undermines future growth.

The choice before Ghana is stark. Act decisively today to protect rivers, farmlands and human lives — or watch as the nation slides deeper into the golden debt trap. Our gold reserves will mean nothing if they leave us with nothing to drink, nothing to farm and nothing to live for.

Galamsey may enrich a few in the short term; but for the nation, it is nothing less than economic suicide. The time to act is now!

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