More than 90% of mining licenses that have been granted in Ghana to date, have been given to Ghanaian owned mining companies, an official of the Minerals Commission has revealed.
Speaking at a two day extractives reporting training workshop organized by Journalists for Business Advocacy for Journalists in Accra this week, Mr. Jerry Ahadzi, a Principal Officer at the Minerals Commission said that, small-scale mining (SSM) is reserved for Ghanaians according to law. And that is where most of these licenses go.
He however lamented the inability of young geology, mining engineering, surveying, minerals processing graduates to form consortium to take advantage of the sector. Yet Ghanaians are worried that, the country is not making much from the sector.
“If our graduates will form a consortium of companies then they can do the right thing in the small scale mining area because most of those engaged in small-scale mining now, are illiterates. They go for the Chinese in terms of equipment and some form of technology. Our graduates can mine systematically and they will not degrade the environment and by so doing will be encouraging local content and all the proceeds will stay in the country,” he said.
These graduates know the value of the resource and therefore will not be motivated to sell off the licenses. After some years of operation, they can also grow into big mining companies.
“The small-scale is not so capital intensive. About GH¢ 10,000 can start a mining operation. Local mining companies pay about 10% of what foreign companies pay in terms of licensing fees,” Ahadzi said.
The Ghana government over the period has supported identifiable small-scale mining groups in Prestea, Konongo and Bolgatanga. But poor repayment mode is threatening the continuation of the support.
Small-scale mining is a significant sector that provides livelihood for millions of people around the world. Small-scale mining therefore has potential to provide substantial benefits to people especially in areas focused on reducing poverty and stimulating economic growth.
On his part, the Director of Tax Services at PricewaterhouseCoopers Ghana Limited, Mr. George Kwatia believes that locating the discussion of taxes paid by mining companies only on Corporate Income Tax (CIT), is not fair. He argues that, mining companies pay all manner of taxes through exploration to close down phases including taxes for their employees, Value Added Tax (VAT), and withholding tax among others.
Sulemana Koney of the Ghana Chamber of Commerce took the opportunity to make a recommendation to the government to consider the need to consult widely prior to changes in fiscal regimes to avoid surprises.
The outgoing General Secretary of the Ghana Journalists Association, Mr. Bright Blewu in his remarks said that there is a challenge in reporting technicalities in areas such as the extractives which usually ends up in misinformation and therefore underscored the need for such workshops to take place to embolden journalists to get sources to the issues.
Mr. Blewu hopes that, this will not be the last but other sectors of the economy will come on board because “our survival as a nation does not depend only on cocoa.”
The mining sector has employed 28,000 in the large scale and an estimated over one million people in the small scale mining sectors.
By Pascal Kelvin Kudiabor/GhanaBusinessNew
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