By Celestine Avi and Seth Eyiah
President John Dramani Mahama has announced plans by the government to strengthen Ghanaian participation in the country’s extractive sector through a new Local Content Bill and reforms to the mining royalty regime.
Speaking at a diaspora town hall meeting with members of the Ghanaian community in the United Kingdom, President Mahama said the measures are aimed at ensuring that a greater share of the benefits from Ghana’s natural resources remains within the country and supports local economic development.
The President noted that for decades, large mining concessions have been granted to foreign companies, which often leave behind environmental degradation and struggling communities after extracting the country’s resources.
To address this imbalance, he said government has introduced a sliding-scale royalty system that increases the state’s share of mining revenue when commodity prices rise.
Using gold as an example, President Mahama explained that royalties will remain at a minimum of five percent when prices are relatively low but could rise to as much as 12 percent when global prices reach significantly higher levels.
“This means Ghana earns more when commodity prices are high, ensuring that the country receives a fairer return from its natural resources,” he said.
The President also disclosed that government is advancing a Local Content Bill that will reserve mining-related ancillary services and subcontracting opportunities for Ghanaian-owned companies.
According to him, Ghana has developed sufficient local expertise through institutions such as the University of Mines and Technology and now possesses the geologists, engineers and specialised firms needed to undertake mining support services.
He said the proposed legislation is intended to curb practices that allow foreign mining firms to channel subcontracting work to affiliated overseas companies, resulting in profits being transferred out of the country.
Under the new framework, activities such as hauling, drilling and blasting would be undertaken by Ghanaian companies, enabling more of the value generated by the mining industry to remain in the local economy.
President Mahama said the reforms form part of a broader strategy to increase local participation in key sectors and ensure that Ghana derives greater benefits from the exploitation of its natural resources.
