Why is government still signing colonial-type contracts that favour foreigners and themselves? - IEA

Director of Research at the Institute of Economic Affairs (IEA), Dr. John Kwakye, has wondered why government keeps signing what he termed as colonial-type of contracts in this dispensation.

According to him, these kinds of contract only benefits foreigners and the government.

His comment was on the back of the approval of the first lithium mining lease to Barari DV Ghana Ltd, a subsidiary of Australia-based Atlantic Lithium.

In a tweet sighted by GhanaWeb Business, Dr. Kwakye said parliament must reject the deal between the Government of Ghana and Barari DV Ghana Limited.

He indicated that the deal was not favourable as asserted by the Minister of Lands and Natural Resources, Samuel Abu Jinapor.

"What do our leaders take us for. Why are they still signing colonial-type contracts that favour foreigners and themselves? Parliament must reject it," he queried.

He further said, "The terms of this license are not as favourable as the Minister would want us to believe. Where is the local - refining component the President promised us? Parliament should reject it!"

The $250-million project located at Ewoyaa in the Mfantseman Municipality in the Central Region is expected to commence production by 2025.

The Minister of Lands and Natural Resources, Samuel Abu Jinapor, signed the 15-year lease agreement over an area of approximately 42.63 square kilometres with the company in Accra on October 19, 2023.

The minister explained that per the mining lease which was in line with the country’s Green Minerals Policy, there had been an increase in royalties rate from the standard five percent to 10 percent.

He added that there had also been an increment in the state’s free carried interest from 10 percent to 13 percent.

Mr Jinapor further said government, through the Minerals Income Investment Fund (MIIF), would acquire an additional six percent shares in the mining company and 3.06 per shares in the holding company, which had been listed on the Australian and London Stock exchanges.

It would be recalled that on July 13, 2022, the Lands and Natural Resources Minister, on behalf of President Akufo-Addo presented a policy statement on the development and management of the green minerals to parliament.

The document was anchored on guaranteeing their exploitation benefitted Ghanaians.

Subsequently, he said, the policy was submitted to Cabinet, which after considerable debate and critique, approved on July 27, 2023.

Some of the key features in the policy include an increase in royalty rate, increase in Ghanaian participation in all green mineral operations to a minimum of 30 percent, enhanced local content and local participation, including listing on the Ghana Stock Exchange; and value addition and beneficiation.

Based on those policies, the Minister said the government entered negotiations with Atlantic Lithium.

https://t.co/uBlqEzLekj. What do our leaders take us for. Why are they still signing colonial-type contracts that favour foreigners and themselves? Parliament must reject it.

— J. K. Kwakye (@JohnKwabenaKwa1) October 22, 2023

https://t.co/sAGlYPhgZn . The terms of this license are not as favourable as the Minister would want us believe. Where is the local- refining component the President promised us? Parliament should reject it!

— J. K. Kwakye (@JohnKwabenaKwa1) October 22, 2023