Why invest in offshore company - Mahama questions Agyapa Royalties deal

Former President John Dramani Mahama has raised concerns over the gold royalties deal between the government of Ghana and Agyapa royalties.

“Why will you be mortgaging this country’s gold royalties, three months to an election to go and collect money to come and spend and so the Minority said we won’t agree so they walked out of Parliament. But they went ahead and passed it,” the NDC flagbearer said while addressing traditional leaders in the Volta region.

He stressed: “We don’t even know those who are behind the company, and as a responsible government, why will you go and invest in an offshore tax haven when you know that is where fraudulent transactions take place?”.

The Majority in Parliment despite a boycott by the Minority went ahead to pass the deal which will see Agyapa Royalties registered in the United Kingdom raising between $500 million and $750 million for the government of Ghana for developmental projects.

Background:

Parliament passed the Minerals Income Investment Fund Act 2018.

The act establishes the Minerals Income Investment Fund to manage the equity interests of Ghana in mining companies, and receive royalties on behalf of government.

The fund is supposed to manage and invest these royalties and revenue from equities for higher returns for the benefit of the country. The law allows the fund to establish Special Purpose Vehicles (SPVs) to use for the appropriate investments. Last month, government introduced an amendment to the act to ensure that the SPVs have unfettered independence.

The minerals royalties investment agreement between the government of Ghana and Minerals Income Investment Fund, Agyapa Royalties Limited and ARG Royalties Ghana Limited is concerning Gold Royalties Monetisation Transaction under the Minerals Income Investment Fund Act, 2018 (Act 978).

The arrangement will immediately make available US$500 million once executed and the remaining half later.