Reposition the country to keep it foremost mining status

The acting Chief Executive Officer of the Ghana Chamber of Mines, Mr. Sulemanu Koney, is advising the country to consider its ‘taxing’ laws and regulations on mining as per ongoing revision of mining laws in other African countries. This would reposition Ghana to maintain its pre-eminent mining status within the West African Sub-region.

This followed the revelation that a number of essential mining reforms have been carried out by gold producing countries within the sub region. This includes Senegal, neighboring countries like Cote d'Ivoire and Burkina Faso that are likely to affect Ghana’s enviable standing as an attractive and leading mining destination within West Africa.

He revealed that reforms in the minerals code of Burkina Faso has placed the country as a significant site for exploration in Africa.

He said similarly to that Cote d'Ivoire, who recently amended it mining code, considered by many as a game changer, has overtaken Ghana in terms of Greenfield projects; attracting investment into exploration.

‘Exploration is essentially the lifeblood of mining industry. It assures that mining projects come on stream on regular basis,’ without which it could spell the fall of mining industry of the country, he explained.

Against this understanding, he stressed that ‘everything has to be done to promote exploration’ in the country. 

He opined that in spite of this competition, Ghana could also develop itself to take advantage of the opportunities that this development present, given the huge competence acquired by the country after long years of mining, in the country.

Mr. Koney made these pronouncements at the annual Ghana Chamber of Mines and media engagement, in Kumasi, which aimed to educate the media on the development and challenges of the country’s mining sector.

Notwithstanding the dwindling fortunes of the mining industry, as a result of the fall in the global gold prices, the sector still remains the leading tax payer, and highest contributor to GRAs domestic tax collections in the past five years. It contributed about GH₵1.1 billion to GRA, representing 18.7% of GRAs total direct taxes in 2013.

The minerals sector also contributed GH₵ 518 million in corporate tax to the GRA, representing 19.5% of the total company tax collected in 2013, and noted as the highest payer of corporate tax payments in 2013.

Despite this appreciable contributions made by the mining sector to the Ghanaian economy, the sector continues to be confronted with a number of challenges, some of which are needed to be tackled with all the seriousness it deserves to ensure the sustainability and growth of the sector.

Among the innumerable challenges facing the sector, it was mentioned that government is yet to refund an estimated amount of GH₵ 250 million, as at June 2014, owed to some mining companies as Surplus VAT, which the Chamber says places these mining companies at a fiscal disadvantage among others.

However assurances by government to increase the amount voted to carter for refunds, and also in due course allow companies to set off against liabilities is yet to occur.

It was also noted that the excruciating cost of utilities, and the cause to have mining companies to pay considerably higher chargers for use of water and electricity as compared to firms with energy demands similar to mining companies, is a major concern to the industry.

The Chamber therefore made a number of recommendations to government to ensure the growth and sustainability of the country’s mining industry.

The Chamber advocated for the introduction of a Mineral Revenue Management Law, akin to the Petroleum Revenue Management Act, Act 815, to ensure transparency and accountability in the utilization of revenues received from mining activities in the country

It also asked for concerted effort to correct what he termed as inverted power pricing structure, and adoption of a Life Cycle and Integrated Approach to mining taxation among others.