You are here: HomeNews2015 09 28Article 384380

Business News of Monday, 28 September 2015

Source: Daily Guide Network

Indians hijack Ghana’s Gold Market

The local gold market has been hijacked by Indians which is adversely affecting Ghanaian players in the sub-sector, BUSINESS GUIDE has gathered.

In 2014, gold export from Ghana (small-scale sector) to India was about $ 1,925 billion.

Owing to the situation, state-owned firm, the Precious Minerals Marketing Company Limited (PMMC), is struggling to survive.

Ironically, PMMC continues to issue licenses to the Indians at a fee of about $5,000.

Managing Director (MD) of PMMC, George Abradu-Otoo, in an interview with BUSINESS GUIDE, said that PMMC expects the Indians to export gold through it and not private exporters.

Mr. Abradu-Otoo said the Indians have refused to comply with the directive.

The MD also accused the Ghanaian exporters of taking paltry amounts of money from the Indians to export gold.

He said the licenses given to local exporters by the Ministry of Lands and Mineral Resources prohibited them from engaging in any third party exports.

Sources close to the Association of Gold Exporters of Ghana (AGEG) said the Indians have taken over the market because of PMMC’s inability to purchase and export gold.

According to them, PMMC and local Ghanaian buyers and exporters do not have the financial strength to compete with the Indians in the sub-sector.

This has made PMMC overly dependent on export contracts from the Indians in order to survive. But that is not really happening because the Indians are reportedly using the local exporters to export their gold at a cheaper rate, according to a source.

Mr. Abradu-Otoo told BUSINESS GUIDE that $1,925 billion recorded by the Indians in 2014 was not returned to the country and that the Indians used the Ghanaian exporters, some of whom used fake licenses.

He attributed the continuous decline of the local currency, the Ghanaian Cedi to the development.

“It may interest you to know that last year alone total gold from Ghana (small scale) to India alone amounted to $1,925 billion. That is the amount of gold that left the country. Please find out how much of this money came back into the system.”

However, BUSINESS GUIDE’s sources said the Indians bring the proceeds back into Ghana in order to purchase more gold.

But they had adopted dubious means to repatriate their proceeds by bypassing Bank of Ghana (BoG).

Interestingly, PMMC is working hard to get the Indians to export gold through it (PMMC) rather than licensed Ghanaian gold exporters, they said.

Join our Newsletter