Chamber bemoans paltry royalties to communities

The Ghana Chamber of Mines says the poor state of host communities continues to reflect negatively on the mining industry.

It has, therefore, expressed concern about the paltry 4.95 per cent of total mineral royalty which is paid to the five district assemblies in whose jurisdiction mining takes place.


For example, in 2013 mining companies paid mineral royalty totaling GH¢ 364 million to the Government but only GH¢ 18 million is expected to be returned to the five district assemblies for development.


“This amount is woefully inadequate for the stimulation of infrastructural development in the mining communities,” Mr Johan Ferreira, President of the Chamber, told journalists after a courtesy call on the Minister of Lands and Natural Resources, Nii Osah Mills.


The meeting was to enable the Chamber to congratulate the Minister on his appointment, introduce new Chamber executives and to share ideas on mining related issues.


Mr Ferreira reiterated the Chamber’s position for 30 per cent of royalties to be returned to mining areas over a specific period of time and tied to specific infrastructural projects in order to stimulate development.


He said the Minerals Development Fund Bill must be passed into law to help ensure judicious use of the amounts returned to the districts for a face-lift of the mining communities through infrastructural projects.

On the sustainability of the mining industry, Mr Ferreira asked Government to adopt a predictable fiscal regime to boost investor confidence and to grow and expand the industry.


He called for implementation of a sliding scale royalty regime based on the price of metals such that when prices reached a predetermined level a particular royalty rate would kick in.


He said the measures were necessary for Government to help grow and expand the mining industry to particularly prolong the life of the mines.


Mr Ferreira said the mining sector, aside being the highest contributor to domestic collections, returned 68 per cent of the $4.7 billion realised from the export of minerals to the country.


“In the last few years, the mining industry has returned a range of between 60 per cent and 73 per cent of its mineral revenue to the country through the Bank of Ghana and the commercial banks, well in excess of the maximum 25 per cent required by law,” he said.