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Business News of Tuesday, 7 August 2018

Source: Starrfmonline.com

New fiscal regime for mining sector soon – Bawumia

Government will soon introduce a new fiscal regime for the mining sector to ensure Ghana derives maximum benefit from the extraction of her mineral resources, the Vice President Dr. Mahamudu Bawumia has revealed.

The paradigm shift in the thinking behind the utilisation of Ghana’s mineral resources would seek to ensure value addition to the minerals mined in Ghana instead of the current system of raw exports, and would also seek to leverage on such minerals to secure holistic national development.

Such thinking has already began to reflect in the Nana Akufo-Addo government’s approach to development with the recent passage by Parliament of a Master Project Facility Agreement that seeks to leverage a fraction of our bauxite deposits in a barter arrangement for infrastructure development worth $2 billion after the Vice President’s business visit to the People’s Republic of China in June last year.

Vice President Dr Bawumia gave an insight into the Akufo-Addo government’s approach to national development when he addressed the chiefs and people of the Essikado Traditional Area in the Western region at the climax of this year’s Kuntum Festival on Saturday 4th August, 2018.

“We have not really benefited from the extraction of our natural resources, and it is for this reason that we need especially in the area of our minerals, to bring a new paradigm, a new thinking into how as a country we can benefit more from our mineral resources,” the Vice President noted.

“There are many mines that are operating and for years, they tell us they have not made any profit so they cannot pay any dividend to government. But they keep mining and mining. How can you as a business continue to be in existence for so long and claim you are not making profit and so you cannot pay. There are some mines that are paying, but many are not paying sufficiently, relative to how much they are taking out of our country.”

Vice President Bawumia indicated that a new fiscal regime similar to the one prevailing in the oil sector would soon be introduced in the mining sector.

“We have a regime that we are implementing for the oil sector, and we want to implement the same regime for the mining sector. So when you take your gold out of the soil, if you take a 1000 tonnes, you will have to pay us our share out of that. We will not wait for you to go and say you have not made any profit out of the 1000 so you will not pay us anything. You will have to pay us something commensurate to what you have taken out.”

The Vice President assured the investor community that while Government welcomes foreign direct investment, such investment would have to be a partnership that was beneficial to all parties.

“We want foreign investment, there is no doubt about that. Our lawyers will say we have given them an invitation to treat. But that invitation to treat must not be an invitation to cheat. We want partnerships, and that is why we want a new regime in the mining sector, so that everyone will pay their share.”

This new thinking, the Vice President emphasised, was the guiding principle behind the decision to leverage a fraction of Ghana’s vast bauxite deposits to build an integrated bauxite and aluminium industry.

“We have decided that we are not going to allow what has happened to gold and manganese to happen with bauxite. Parliament just passed the Ghana Integrated Bauxite Authority Bill. We are forming this corporation, and will be forming partnerships with anybody who comes, a joint venture, to build an integrated bauxite and aluminium industry.

“We don’t want the raw bauxite being taken out of Ghana anymore. We will build a refinery here to refine the bauxite to alumina, take it to VALCO, and get aluminium and you will see the massive increase in value. This is going to be transformational,” the Vice President stated.

Vice President Bawumia commended the Omanhene of Essikado Traditional Area, Nana Kwabena Nketsiah V for his “continuous drive and contribution towards a better Ghanaian society for all”.

“Nana is indeed a true chip off the old block” Dr Bawumia declared, and called for the sustenance of the peace and unity enjoyed by the people of Essikado and the nation as a whole.