European Metals & Mining: Ghana Gold Miners Expert Feedback: Options still on the table

Research evidence excerpt

European Metals & Mining: Ghana Gold Miners Expert Feedback: Options still on the table

Rising risk but some constraints

Macro Takeaways

• Ghana's macroeconomic recovery appears genuine, with improving inflation,

stronger reserves, improving debt metrics and rising business confidence.

• However, the recovery has become increasingly dependent on gold, which now

represents approximately 65% of exports and could move closer to 70% as cocoa

and oil contributions weaken.

• Government policy is becoming increasingly intertwined with the gold sector

through reserve accumulation, FX management and domestic gold purchasing

programs.

• Gold prices have been a major enabler of policy stability; many of the current

interventions would likely become more contentious in a lower gold price

environment.

• Resource nationalism currently enjoys broad popular support and would not lead to

any marked policy shift should government leaders change.

• The succession process within the ruling NDC party is becoming increasingly

important, as potential future leaders are largely aligned on the broader localization

agenda.

Mining Sector Policy Direction

• Ghana is moving away from a purely fiscal approach towards mining regulation and

increasingly focusing on localization, domestic ownership and greater value

retention within the country.

• Stability agreements are expected to become shorter, while renewals are intended

to become substantive reviews rather than administrative processes.

• Greater discretion is being granted to government and ministers during licence

renewal negotiations.

• New policy proposals include:

o Surface mining activities moving to Ghanaian operators.

o Underground mining contracting moving towards 50% Ghanaian

ownership.