Accra, Ghana, November 27, 2018//-Producing members of the Ghana Chamber of Mines returned $2.75 billion of their $3.68 billion mineral revenue into the country in 2017.
This represents 70 percent of mineral revenue in 2017, according to the 2017 Annual Report which is in the possession of African Eye Report.
In 2017, $368.164 million of the returned mineral revenue of $2.75 billion was brought back into the country through the BoG. This translates into 22 percent of mineral revenue.
The remaining $2.20 billion was returned into the country through the commercial banks, the report disclosed.
The total expenditure of the producing member companies on goods and services procured from in-country suppliers and manufacturers stood at $1.23 billion in 2017.
This represents 34 percent of realized mineral revenue and an increment over the 31 percent outturn in 2016, it added.
Furthermore, the proportion of the producing mines’ expenditure of mineral revenue on imported consumables declined from 7 percent in 2016 to 6 percent in 2017.
“The 2017 share of expenditure translates into $215.6 million in nominal terms. In the last few years, the companies’ pattern of expenditure consistently shows year-on-year increases in demand for locally sourced inputs and steadily decline in spending on imported consumables”.
To a large extent, this mirrors the mining industry’s efforts to substitute imported inputs used in the production process with comparable ones from the local economy.
However, the mining companies’ statutory payments to parastatals and central government totalled $400.4 million in 2017 while compensation payments to employees were $515.1 million in the same period. These represent 11 percent and 14 percent of realized mineral revenue respectively.
The corresponding shares in the preceding year were 10 percent and 13 percent respectively.
Payments to other shareholders were also $36.8 million in 2017, representing 1 percent of mineral revenue.
Expenditure on electricity, diesel, capex and amortisation were $307.2 million, $285.6 million, $695.8 million and $349.4 million respectively.
In relation to the share of mineral receipts, these expenditures translate into 8 percent, 7.8 percent, 18.9 percent and 9.5 percent respectively.
The producing mines also spent $19.8 million on various social intervention projects in their respective host communities.
This was an improvement over the $12.2 million invested in the operational areas of producing mines in 2016.
Typically, the mineral revenue is brought back into the country through the commercial and central banks.
Since 2016, however the Bank of Ghana (BoG) issued a directive for mining companies and other export revenue earners to cede the equivalent share of their foreign exchange revenue under the mandatory surrender requirements to commercial banks.
The objective of the directive was to deepen the foreign exchange market.
Notwithstanding, the BoG continues to be a conduit for ploughing back mineral export proceeds into the country due to some challenges in implementing the policy directive.
African Eye Report
