Mining in Ghana predates the colonial era which is how the country earned its name the Gold Coast. The mining sector was diversified after the Economic Recovery Programme of 1983 which reduced the state’s involvement in the direct production of minerals. This has over the years attracted many players into Ghana’s mining sector from all over the world such as Gold Fields from South Africa and Newmont Goldcorp from the USA among others. Foreign Investors in the mining sector are not mandated to have local participation by law as it exists in other extractive industries. Though foreign companies are not mandated to have local participation, small scale mining is reserved for Ghanaians.
Ghana produces commercial quantities of Gold, Bauxite, Manganese, Diamonds, and iron ore; however, the mining sector is dominated by gold production as the country is the highest gold producer in Africa and part of the top 10 gold producers in the World. Gold accounts for about 95% of the country’s mineral revenue. The mining industry is a main contributor to the Ghanaian economy as it contributes about 19% of all direct tax payments in the country as well as 37% of export revenues.
The country also has deposits of limestone, feldspar, quartz and columbite-tantalite which require further exploration and exploitation. The country is not only Africa’s largest producer of gold but also has one of the largest bauxite reserves of an estimated 960m tonnes valued at about US$460 billion. The Nsuta Manganese mine also has about 45m tonnes of reserves which has one of the highest manganese-to-iron ratios in the world making it suited for the production of alloy and manganese metal.
Ghana’s production, purchases and shipments of its traditional minerals were subdued in 2020 compared to the preceding year owing to the spillover effects of the COVID-19 pandemic. The sector however saw an increase in its contribution to the nations fiscal purse, increasing from GHS4.013 billion in 2019 to GHS4.172 billion in 2020, thereby maintaining its position as the leading source of domestic revenue. This increase in fiscal revenue contribution was as a result of an increase in receipts from mineral royalties.
The production of bauxite saw an increase in 2020 compared to that of 2019 by 4.1% while the other major minerals (Gold, Manganese and Diamond) saw a decline in production of 2.6%, 9.68% and 24.24% respectively for 2020. The decline in mineral production is attributed to the contraction in the production by most mines due to the effects of the COVID pandemic, mine specific factors and the outcome of government’s “stop and start” directives to the mines which led to a suspension in production within the first quarter of 2020.
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