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Business News of Monday, 31 August 2020

Source: www.ghanaweb.com

Agyapa Royalties deal part of Ghana Beyond Aid agenda - Ken Ofori-Atta

Finance Minister Ken Ofori-Atta has said the controversial Agyapa Royalties deal is part of the ‘Ghana Beyond Aid’ agenda.

He made this statement while briefing the press on the details of the gold royalties management deal.

Addressing participants at the event, Ken Ofori-Atta stated that “Five hundred times more gold is traded every day than is mined; much of this happens in countries that have virtually no gold to themselves. President Nana Addo Dankwa Akufo-Addo says to achieve Ghana Beyond Aid we must add considerable value to what we produce and trade”.

“We all fail to see this value because when assessing the effectiveness of our policies and legislations, we limit the extent of expectations to our national boarder.”

He further explained that “we take no interest in what happens to our resources when they leave our shores, whether how they are traded in foreign markets or how companies leverage them to create cheap financing or the different ways in which they are utilizing to generate profits”.

Ken Ofori-Atta bemoaned how Ghana has over the years enjoyed a marginal benefit from natural resources. This, he believes, has placed the nation at the bottom of lists of beneficiaries of rich countries.

“For centuries, the reality has been our governments and our people get far less than what we deserved.”

“We are placed at the bottom of the list of the beneficiaries of our own riches; whether it is gold, cocoa, timber, bauxite or diamond. The story has been everywhere. This is predominately to do with the fact that our value extractions and the point that resources leave our shores. Unfortunately, analysis taken over the period has shown that the largest increase in value occurs at exactly this point when it leaves our shores,” he stressed.

The Finance Minister also indicated that said government is committed to breaking the economy free from the old practices of exporting natural resources without added value.

“If the foreign investor can use recoverable reserves in our country– he has in our permission granted us to him– to raise monies which he can choose to spend here or other businesses elsewhere, why can’t we do the same to maximize the benefit we get and use that additional income to accelerate our development and by so doing expand our economy,” Mr. Ofori-Atta questioned.

According to him, the country has failed to leverage the most important element of risk value that is future cash flows, adding “companies utilize their assets to our concessions and future resources as a means to invest in new exploration, new developments, technology, diversification, ultimately to reduce their cost of borrowing.”

Agyapa is 100% owned by the Minerals Income Investment Fund, which is a state organization.

The deal was approved on Friday 14th August 2020, with the minority boycotting the endorsement.

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