The Institute of Economic Affairs (IEA) has called for the establishment of a state-owned Ghana Lithium Company (GLC) to anchor full domestic participation in the emerging lithium industry.

The recommendation, contained in a communique, argued that Ghana risks repeating decades of low-value mineral extraction unless it secures greater ownership, processing capability and long-term control of the resource.

The policy think-tank said the discovery of commercially viable lithium deposits, particularly the Ewoyaa project in Central Region, presents one of the strongest opportunities yet for Ghana to break from its long-standing reliance on royalty-based concession structures.

It said the financial and industrial potential of lithium, alongside rising global demand for battery minerals, underscored the need for a new ownership and operational model that places the state at the centre of value creation.

In its statement, IEA argued that Ghana’s broader economic vulnerabilities, low revenues, high debt and what it described as “repeated cycles of economic crises” reflect a deeper structural challenge linked to weak returns from the extractive sector.

It noted that: “The fiscal and legal arrangements governing exploitation of our mineral resources account for the meagre benefits the country has derived from these resources”.

The statement added: “An arrangement that transfers ownership of the country’s mineral wealth to foreign companies in exchange for royalties cannot support the country’s quest for sustainable development and industrialisation”.

According to IEA, the feasibility study on the Ewoyaa project shows exceptional profitability – making the case for stronger domestic participation.

It cited data indicating an Internal Rate of Return at 105 percent and a payback period of about 19 months despite a 12-year mine life. Yet under the current agreement, Ghana’s benefits remain limited to royalties and minority equity stakes.

Against this backdrop, the organisation said government must adopt a fundamentally different approach.

It called for immediate creation of a state-owned entity mandated to lead the full lithium value chain – from mining to refining, processing and battery production. The IEA stated that “the GLC should be mandated to develop the entire lithium value chain from raw lithium to batteries in Ghana”.

Using projections from Barari DV, IEA estimated that the Ewoyaa project could produce 3.6 million tonnes of spodumene concentrate over its lifespan.

It argued that processing this domestically into lithium carbonate could significantly increase national earnings.

With a conversion factor of 5.323 and a market price of US$9,000 per metric tonne, the IEA calculated potential revenue of roughly US$172.5billion across the mine’s life. It noted that “developing the value chain becomes critical”, asserting that these figures justify a policy shift toward domestic processing rather than raw mineral exports.

IEA said legislative and policy reforms will be required to support the new approach and encouraged government to halt the impending agreement.

“Parliament must halt ratification of the Revised Lithium Agreement between Ghana and Barari currently before parliament. This is critical because the agreement in its current form is not only a continuation of the colonial type agreements Ghana has had in

its gold and oil sectors, but also fails to comply with the requirements of major international frameworks signed and ratified by Ghana,” the statement read.

“IEA seeks a review of the lithium agreement to ensure greater state and local ownership and control within these international frameworks,” it added.

It also sought to counter concerns about financing, stating that: “Most foreign companies leverage on our natural resources to raise the required capital”.

The statement pointed to the Minerals Income Investment Fund’s US$33million investment in the Ewoyaa project as evidence that domestic institutions can support the sector.

The think-tank said the global shift toward renewable energy, electric vehicles and digital infrastructure strengthens the case for national ownership. It added that “lithium remains a critical mineral Ghana must mine for national benefit”, arguing that the country should avoid “the colonial course of giving away ownership rights to foreign companies”.

IEA added that Ghana should position itself to “derive maximum benefits from the lithium discovery” by taking ownership of the resource and building a local industrial base capable of capturing long-term value.

This comes as global lithium prices have undergone a sharp correction since early 2023, following an unprecedented boom in 2021–2022.

Battery-grade lithium carbonate, which traded at elevated levels through early 2023, fell steeply through 2024 as rapid supply growth outpaced demand from electric-vehicle manufacturers and battery producers.

By the end of 2024 average prices had declined to roughly US$10,254 per tonne, with spot levels in early 2025 hovering around US$9,000–US$9,700 per tonne.

Spodumene concentrate followed a similar path, sliding from peaks above US$1,300 per tonne to the US$740–US$850 range.

The downturn has been attributed to significant global oversupply and a slower-than-expected pick-up in battery demand, conditions that continued to weigh on producers into 2025.

Despite the near-term softness, medium-term projections remain broadly positive – with several research groups expecting supply-demand rebalancing from 2026 onward as production cuts take hold and electric-vehicle and storage demand accelerates.

Some industry forecasts indicate lithium carbonate prices could climb back toward the US$15,000–US$20,000 per tonne range by the latter part of the decade, provided project delays and permitting constraints limit new supply.