Page 62 - Vol 28 Issue 29 2019

mining accountability

Ghana’s Mining Communities Are

Still Not Getting Their Just Dues

By Päivi Lujala

Mining town in Ghana

hana has gold, diamonds, bauxite, through land acquisitions, environmental it received to fund research and
manganese, salt, limestone, granite degradation, pollution and a high development in the mining sector and to
Gand oil. Its mining and quarrying cost of living. Although the host transfer the remaining to the Office of the
sector contributes significantly to communities are entitled to different Administrator of Stool Lands. This office is
its economy. It is the second-largest gold types of compensation and mineral a national institution mandated by Ghana’s
producer in Africa after South Africa and royalty transfers, they are still among Constitution and the Stool Lands Act to
the tenth-largest producer in the world. the poorest communities in the country. collect and distribute customary land
One important reason is the local revenues. The office was to retain 10% of
authorities’ capture of mineral royalties what it received and transfer 20% of what
transferred back to the mining areas. remained to paramount chiefs, 25% to
Two years ago, gold, the In 1993 the government of Ghana traditional councils and 55% to the district
flagship mineral, contributed established the Minerals Development assemblies of the mining company’s
96% of mineral export Fund to, among other things, fund and operation area. The local authorities
revenues (excluding oil and implement development projects in were supposed to use the mineral
gas). In total, the mining communities affected by mining. The royalties to develop mining communities.
aim was also to transfer mineral royalties
sector contributed 43% of to local authorities. In Ghana, mining Despite the establishment of the Minerals
export revenues in 2017. companies must pay up to 5% of their Development Fund, mining communities
remained saddled with social, economic
total revenues as royalties to the state, and ecological challenges. This was
and of that, the government transfers partly because transferred royalties were
But mining communities in Ghana are 20% to the Minerals Development Fund. captured by local elites. And there were
generally poor. Mining imposes socio- The fund was to keep half of what issues around prompt payments to the
economic costs on host communities

62 | AFRICAN POWER Mining & Oil Review Vol 28, Issue 29, 2019 Celebrating 10 years of excellence