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Business News of Monday, 24 February 2020

Source: goldstreetbusiness.com

Ghana seeks joint venture partners for integrated bauxite development


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Government has begun the processes aimed at selecting suitable joint venture firms to partner Ghana’s effort in developing its vast aluminium, bauxite as well as manganese and iron ore deposits.

The said partners are expected to be selected early this year. This was revealed in the 2020 State of the Nation Address (SONA) presented to parliament last Thursday by the President, Nana Akufo Addo.

“We are determined to exploit our large bauxite, manganese and iron ore deposits, which will enable us to establish an integrated bauxite and aluminium industry, and an iron and steel industry”, the president affirmed.

The move forms part of strategic measures being implemented to develop full value chains for the aluminium and bauxite sectors in order to give a direly needed boost to Ghana’s industrialization drive.

Ghana is looking to mine bauxite to uphold what it calls a barter deal with China’s Sinohydro Corp. Limited. Sinohydro is required to deliver US$2 billion worth of infrastructure projects across the country, which Ghana would pay back with proceeds from the sale of the refined bauxite.

Reports indicate that the partners will largely invest into building a refinery and smelting plants to process the raw bauxite mined so as to exploit and add value to Ghana’s estimated 960 million metric tons of bauxite deposits.

Already, the Ghana Integrated Bauxite and Aluminum Development Corporation and the Ghana Integrated Iron and Steel Corporation have been established as the vehicles for development and exploitation in these two potentially multi-billion dollar extractive sectors which Ghana is yet to exploit for the needed benefits.

A recent assessment conducted by the Ghana Chamber of Mines indicates that the total proceeds from the country’s exports of solid minerals declined by 3.7 percent from US$6.004 billion in 2017 to US$5.779 billion in 2018.

The drop in receipts from mineral exports in 2018 is attributed largely to the simultaneous falls in the export values of gold, diamond and bauxite which outweighed the expansion in the value of manganese shipments.

Receipts from the sale of bauxite saw contraction of 53.7 percent in 2018. Conversely though, proceeds from the export of manganese increased by 77.9 percent, from US$164.51 million in 2017 to US$292.71 million in 2018.

Background

Ghana signed an agreement in 2017 with China’s government for the development of an integrated US$10 billion full bauxite value chain that includes the construction of alumina refineries and railway infrastructure.

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