Business News of 2013-12-18

Mine workers cry for gov’t support

Mine workers in the country have called on government to sustain the mining sector in the wake of the falling price of gold on the world market.

According to them, the falling price of gold on the world market was affecting the sustainability of the mining companies.

Over 3,000 mine workers have been laid off by mining companies in the country due to the decline in the price of gold on the world market.

Four hundred workers are also expected to be laid off early next year.

Prince William Ankrah, General Secretary, Ghana Mineworkers Union (GMWU), who was speaking at the Union’s National Executive Committee (NEC) meeting, said government has a part to play in salvaging the mining firms in view of the falling gold price.

He said governments in other countries like the United States of America were able to bail out companies during the global economic meltdown, urging government of Ghana to do same.

William Ankrah called on the management of mining companies to put the right measures in place in order to contain the shocks of the cyclic fall of gold price on the world market.

According to him, studies had shown that prices of gold and other precious minerals usually fall each decade, which often presents critical challenges to players in the industry.

The situation requires that players in the mining sector reposition themselves in the face of possible mines’ closure and redundancies, William Ankrah said.

He suggested that the mining companies should invest their earnings to enable them adequately prepare during soaring prices of gold and other precious minerals.

William Ankrah said the situation could worsen if nothing changes, urging the mining companies to learn their lessons and adjust to the situation.

After peaking at $1,921.15 an ounce in September 2011, gold price fell to as low as $1,180.50 in June, this year, the lowest price since 2010.

Analysts have predicted that the price of gold will average $1,000 in 2014 and $840 in 2015 because a stronger U.S economy will limit the appeal of gold.