IEA wants Newmont Akyem Gold Mine sold to local investors

The Institute of Economic Affairs (IEA) has urged the government to consider local investors for the sale of the Newmont Akyem Gold Mine when the lease with the company expires in January, next year.

Citing national security concerns, the Institute advised that the government limited foreign investors’ stake in the critical minerals sector to safeguard the country’s economic interests and national security.

It has, therefore, cautioned against a a planned sale of the Gold Mine to Zijin Mining Group of China for US$1.0 billion, as reported by the Business Times on October 9, 2024.

“IEA sees the deal to be flawed in several respects, inimical to Ghana’s interest and unacceptable,” it stated regarding the purported new lease.

In a media statement, issued on Monday, the IEA thus urged the government to act in the interest of Ghanaians by acting in the interest of Ghanaians.

It said that it was not opposed to foreign investments, but believed that Ghana should maintain dominant control over its mining sector to ensure that the associated wealth benefited the country.

The existing lease agreement between the Ghanaian government and Newmont was signed on January 19, 2010, with a 15-year validity that expires on January 19, 2025, it explained.

The agreement allowed for transfer of the lease during this period, but only with mutual consent from the government and Newmont.

The Institute said that any sale of the mine must occur under these conditions and apply only to the unexpired term of the lease.

The IEA said that Newmont was obligated to return the mine to the government upon lease expiration, and any company interested in operating the mine after January 2025 must negotiate a new agreement with the Government.

The IEA, however, noted that it was unaware of any agreement between the government and Newmont for the transfer of the lease to Zijin, nor had Newmont sought an extension of the lease.

The Institute proposed amendment to Article 257(6) of the Constitution that vests Ghana’s natural resources in the President on behalf of, and in trust for, the people which seems to give [the president] a “carte blanche to sign the resources away at will.”

“The natural resources should rather be vested in the state and every contract should require Parliamentary ratification as per Article 268(1) of the Constitution,” it said.

It also proposed an amendment to the Minerals and Mining Act, 2006 (Act 703), to prohibit governments from signing contracts of significant value during the last six months of their term.

This, they believed, would “prevent any incumbent administrations from signing eleventh-hour contracts in favour of their families, friends or cohorts, or for personal gain.”