The Ghana Gold Board (GoldBod) is, at present, embroiled in a verbal dispute with the minority New Patriotic Party (NPP) over an IMF’s 2025 irksome report on Ghana’s Gold Purchase Programme (GGPP). According to the NPP, the losses made on the ‘Gold for Oil’ and ‘Gold for Reserve’ subcomponents of the GGPP, particularly that of ‘Gold for Reserve’, should be sitting squarely on the books of GoldBod because ‘a loss is a loss and it does not matter where it sits’. As could be anticipated, the leadership of the GoldBod did not take kindly to some of the aspersions casted in the minority’s numerous statements and talk shows. It is not an intention of this writer to contribute to the dispute but to bring to the fore some of the real issues facing gold production and which the GoldBod should focus upon.
There is never a winner in a verbal dispute, and our concern as Ghanaians should rather be whether GoldBod’s intervention, so far, is a ‘struggle for economic survival’ or ‘resource nationalism’ ingrained in attempt to secure steps on a pathway towards attainment of ‘resource sovereignty’. When this question was asked Sammy Gyamfi, Esq., he explained the interventions were meant to secure ‘economic survival’ through price and monetary stability and not a struggle for ‘resource nationalism’ or sovereignty. This is understandable given the location of GoldBod along the value chain. It does not have the mandate and cover to bring real changes to the upstream production in the golden enclave of our economy. The GoldBod’s reform, at best, is a simple tinkering of the upstream value-chain.
Before we proceed, it is imperative a distinction is made between ‘Resource Sovereignty’ and ‘Resource Nationalism’. The former takes its root from the premise that the continent of Africa is the world’s largest and richest mineral producing continent. In spite of this fact and owing to pervasiveness of foreign ownership, control, absence of in-continent processing and domination of commodity metal markets, Africa benefits from minute fractions of the full economic value of her natural resources. This has led to the recognition that Africa should have the supreme authority to control, manage, and benefit from her mineral and other natural resources since the continent’s mineral wealth can no longer serve primarily as raw material for foreign industrialisation. Resource sovereignty therefore seeks to restore Africa’s autonomous authority over her mineral resources as well as mitigate the current resource leakages associated with the industry’s illicit financial flows, smuggling and trading. Its objective is to re-direct production and processing rents currently accruing to metropolitan capitals back for the latter’s transformative benefit. Resource nationalism, on the other hand, is the political and economic policy actions taken by a country to assert the legal rights conferred by resource sovereignty. Most often, it permits State ownership, and management of the country’s mineral and natural resources for instance through regulatory control, smelting and refining of mineral ores in-country with the object to retain maximum value to support domestic fiscal and monetary policy.
Just like the other two enclaves of the Ghanaian economy namely cocoa and petroleum, the golden enclave inherited at Independence was never meant to facilitate or speed up economic development primarily because there was very little or no forward and backward linkages with the cocoa and petroleum production enclaves. Its infrastructure was exclusively constructed as part of a system of British colonial legal architecture to alienate the colony’s mineral wealth, maximize accumulation and extraction of surplus from the then Gold Coast, a peripheral economy, while serving the metropolitan shareholder interests of British, American and Canadian capital. The golden enclave has always been a highly capital-intensive sector dominated by the presence of transnational corporations (TNCs) and technologies normally designed for high-wage environments on one part and labour-market informalisation which required the increasing use of contractors on the other part. A major feature of the enclave is the predominance of a system of unfair upstream payments made up of nominal rents or royalties which have no relationship with the value of minerals extracted.
Until 2005, or thereabouts, indigenous small or illegal mining operations were literally non-existent within the enclave as they were proscribed under the Mercury Ordinance,1933 which regulated the use of mercury for mining. The current structure of the enclave therefore remains one whereby ‘formal sovereignty’ or ownership through the Concessions Act is separated from ‘effective control’ of mineral resources and rights. In other words, while the Ghanaian State appears to have ‘formal sovereignty’ over the mineral wealth of this country it has no control over the mined mineral resources owing to several pieces of legislation. The main ones are the Minerals and Mining Law, 1986 (PNDCL 153) which was replaced by the Minerals and Mining Act,2006 (Act 703). Of course, the force of the former dismantled the limited presence of the State in the mineral ore subsector of the enclave and recreated the current ubiquitous conditions of pervasive foreign ownership and control by British, American, Australian and Canadian capital. It is the infamy of this Act which reintroduced and granted to TNCs the colonial fiscal model of minimal royalty payment, extensive tax holidays, generous capital allowances and writing off 80% of total investment in the first year of operations; a complete rip-off of our rights.
In respect of Act 703, it assiduously added insult to injury by consolidating the postcolonial fiscal regime and interest of foreign capital. This Act minimizes Ghana’s overall share in the enclave operations. Besides ensuring the country is always shortchanged, the Act’s devious mechanism enabled the direct application of a standardised 5% mineral royalty rate to gross revenue whilst its s.48 freezes for 15 years the duration of years during which foreign mining companies have to operate unimpeded without any future Government imposing new environmental regulations or daring to revise royalties. It is this section which enjoins every Government to first pay compensation prior to initiation of policies to reverse the status quo. The final act of this law is to outlaw any imposition of additional profit tax on the gold mining sector during commodity price booms even when gold prices are on the rise and supernormal profits are being made by the enclave industries. It is therefore not surprising that at the flipside, the enclave has been historically vulnerable to informal trading of gold ore and resource leakage.
Though the foregoing narrative vividly captures the present state of the golden enclave, it is not the immediate headache of the GoldBod and its management board because the interventions being implemented by the GoldBod are not meant to fundamentally rock the structural foundation of the Ghanaian peripheral enclave and its subordination to metropolitan accumulation of the surplus. It is also not about meddling with the direct appropriation of surplus through regaining ownership of productive assets currently owned and extracted by Newmont, AngloGold Ashanti, Gold Fields, and others. After the present reforms have paled off, Ghana’s mining sector will still be dominated by 87% of foreign capital ownership, and the surplus generated will continue to accrue to the metropolitan shareholders of these TNCs. Nothing in the enclave will change.
Moreso, in Lawyer Sammy Gyamfi’s candid opinion, ‘Ghana’s gold wealth should not only be extracted, [but] be refined and secured within Ghana’ this policy effort is directed to containing ‘the small-scale mines and local producers so that more value stays in Ghana to [flow to] the national treasury. We owe it to ourselves, our children and future generations to ensure that our gold is refined locally and benefits our economy.’ Excellent nationalism but meanwhile the large foreign mines are let go and given the freehand to continue the rape of our mineral resources. This is Sammy Gyamfi’s resource nationalism par excellence. In his candid opinion, the interventions are neither meant to rock the rip off imposed on us by the status quo nor interfere with the metropolitan accumulation and rabid extraction of imperial rents by Newmont, AngloGold Ashanti, and Goldfields to mention a few from the country’s golden enclave. It is also not about freeing the golden enclave from foreign control and lopsided competitiveness. Ghana’s mining sector will still be dominated by manipulation of intra-corporate pricing and shifting of profits out of our tax jurisdiction.
Of course, this is not the first time in our economic history that a clear attempt is being made to break away and to pursue resource nationalism or sovereignty. In 1963, President Kwame Nkrumah and the CPP government made a clear attempt to systematically concentrate and add value to our gold dore or any mined mineral through smelting and refining. The Tarkwa Gold Refinery and Ghana Diamond Marketing Board were established and converted into state-owned enterprises in 1965 to purchase and market the country’s diamonds and other precious minerals. The establishment of the Ghana Gold Board (GoldBod) in 2025, under the Gold Board Act, (Act 1140), is therefore a welcome and refreshing intervention aimed at strengthening industry regulation and optimizing such national benefits as foreign exchange inflows, gold reserve accumulation and value addition. A wise step in the right direction.
Under its establishment Act, GoldBod has an overarching function to regulate the gold enclave through:
- licensing of aggregators, fabricators, refineries, and Tier 1 or Tier 2 buyers, etc.,
- assaying, weighing, grading, valuing,
- trading and exporting gold and other precious minerals in Ghana,
- providing vault services,
- combating gold smuggling using supply chain traceability tools, and
- providing support to small-scale miners.
Despite being a stopgap measure along the path of resource sovereignty, GoldBod has zealously held its own and performed its role and function well for the past 18 months. If successful, it would increase the nation’s smelting and refining capacity for gold dore thereby creating reliable livelihoods and industry. It will also build a national gold-based economy capable of harnessing the country’s 200 mt potential to serve the citizenry through job creation and employment.
I am done and will be back.
Olivier Goldstone
