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1
Keynote address Delivered by P. Amponsah-Mensah (Director, PAMICOR Limited)
At the 2ND
Quarterly Meeting of The Accra Mi...
2
national economy and society. Additionally, I believe we are confronted by an outstanding challenge
to ensure that our i...
3
Historical antecedents
In Ghana, our mineral resources portfolio includes gold, bauxite, manganese, potash, and diamonds...
4
the regulatory framework developed via the laws and institutions, generous incentives were
provided to foreign investors...
5
Though the Ghanaian economy is not, by the United Nations definition, a mining economy, the
minerals sector has made not...
6
There is strong scepticism as to whether the mining sector’s fiscal regime presents opportunities for
increased governme...
7
wealth; operating under poor labour conditions; polluting the environment; and being responsible
for health and safety f...
8
A comparison of Dow Jones index averages (DJIA) and
the gold price over 45 years indicate that the price of
minerals hav...
9
Now, it is in the interest of miners to develop operational methods that are environmentally friendly
or go bust.
Ladies...
10
insolvent. Until Government pays its bills, and tariffs are properly set, the Government will struggle
to provide an en...
11
AMN doing effective lobbying and advocacy work to ensure that what is in our common interest
receives persuasive hearin...
12
and operationalise policies to protect this resource or else we risk escalating our production costs,
and in the worst ...
13
Ladies and gentlemen, in exploring the way forward amidst the changing dynamics of the industry,
developing economies a...
14
disclosure of our licensing and other processes. We can improve on our ease of doing business
position in the world.
Th...
15
than royalties, etc. The current acceptance and implementation of the procurement route in the
Local content law may be...
16
Mr. Chairman, the call by the Chamber of mines for FDI in the provision of inputs for our industry at
the Indaba in SA ...
17
Mr. Chairman, I am strongly convinced that our industry has a great deal more to offer to our nation
in its development...
18
bankroller to the nation (you mention that you are a miner and people think Money). Our safety
records and safety manag...
19
The Chamber of mines and AMN are encouraged to be seen to be creating and championing this
agenda. They should harness ...
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Keynote presentation by Peter Amponsah-Mensah at Q2 of AMN in 2015

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Theme: Riding the next wave, how ready is the Ghanaian mining industry. By 2050 Africa would be the home to 20% of the world’s population and its workforce continues to increase ...the mining industry faces many challenges resulting from
1) unfavourable market forces,
2) incongruent and misaligned policies and
3) personal/partial interests that override general industry interest

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Keynote presentation by Peter Amponsah-Mensah at Q2 of AMN in 2015

  1. 1. 1 Keynote address Delivered by P. Amponsah-Mensah (Director, PAMICOR Limited) At the 2ND Quarterly Meeting of The Accra Mining Network (AMN) at the Chamber of Mines Conference Hall, Accra on July 24th 2015 Time 5.00pm Theme: Riding the next wave, how ready is the Ghanaian mining industry? INTRODUCTION Mr. Chairman, invited guests, members of our mining and geoscience community, members of the inky fraternity, ladies and gentlemen: with all other protocols observed, I wish to welcome you again to this session. I deem it an honour to be invited to deliver the keynote address at the Networks 2nd quarterly meeting. The honour is the more special since I am doing this on the heels of the previous speaker, the distinguished Rev. Dr. Joyce Aryee. I would first like to thank God Almighty for His grace, mercies and guidance as I navigate the mining seas. My profound appreciation goes to my wife and daughters also for continuously sustaining me with their loyal support. Finally, let me thank the Accra Mining Network (AMN), and Georgette especially, for affording me this platform to share my experiences. I am glad to be amongst you, as a fellow, to share with you my thoughts on the mining industry of our beloved country. I see the AMN as a new institutional voice and force. One of our outstanding aims in coming together, you will agree with me, is to carve out a place of relevance and influence for our voice in Ghanaian national affairs. In this regard I believe it is one of our important roles to contribute, from our particular standpoint as mining practitioners, to the general national discourse and practice of socioeconomic improvement. Thus it is my intention in this talk to bring us to probe ourselves—and to establish what it is that must be heard from our voice. We need to establish terms and benchmarks in regard of what we can meaningfully and materially contribute to advancing our
  2. 2. 2 national economy and society. Additionally, I believe we are confronted by an outstanding challenge to ensure that our industry occupies the commanding heights of the national economy. Here and now there is a genuine question of whether—and if so how—the mining industry can remain at the Ghanaian economic forefront. For we find ourselves competing for economic primacy in an era of worldwide transition from economies based on mineral resources and agriculture to knowledge- based ones. Ladies and gentlemen, that Ghana is a developing country is my point. And, given this context, it is relevant to ascertain what our industry’s contribution to national economic growth and development now and in the future will be. In what optimal ways might we equip ourselves and enact our capacity to impact the economy in the next two and a half decades? What is more, what do we foresee the Ghanaian mining industry looking like beyond those 25 years? I believe that these questions, in the light of current trends in the industry, have given all of us gathered here some sleepless nights. They are questions that are at the heart our existence as professionals, practitioners and beneficiaries of the industry in Ghana and Africa in general. Ladies and gentlemen, the Africa Mining Report (AMR qtr2 2015), posits that “Africa hosts about 30% of global mineral resources, and these resources have accounted for about 35% of Africa’s growth for the past decade and a half. Africa is the second most populous continent after Asia and the fastest growing part of the world. By 2050 Africa would be the home to 20% of the world’s population and its workforce continues to increase and [upskill”???]. This scenario presents a rare opportunity to us as a nation whose mineral resources industry has been at the fore of mineral resource development in Africa. (The country was one time, a leading producer of gold in the world and accounted for about 35.5 % of total world gold output between 1493 and 1600)
  3. 3. 3 Historical antecedents In Ghana, our mineral resources portfolio includes gold, bauxite, manganese, potash, and diamonds, to name a few. Gold accounts for about 90% of our mineral resources’ contribution to GDP. Ghana remains the second largest Gold producer in Africa, and is ranked 9th in the world (2013). This country has the 10th largest gold deposit in the world. Mr. Chairman even as we attempt to diversify the industry to promote other mineral resources in our portfolio, gold continues to be the pulse beat of our industry. It is pertinent therefore to use gold indices in determining the state of our industry. Ghana’s gold production climbed to a record 4.3 million ounces in 2012, up from 3.6 million ounces the previous year. The price of gold reached a record in September 2011 (9/11). Over the past two decades gold production from small scale miners has grown exponentially, and has become a significant supplement to that of large-scale producers. Small-scale gold production has gone from 9000oz (1980) to 384,000oz in 2010 and a third (34%) of the total gold output in 2013. These signal developments have culminated from the unrivalled priority attention received by the mining sector in the country under the Economic Recovery Programme (ERP) initiated in 1983. Apart from the general macro-economic policy reforms in the country, there were specific sector policy reforms that sought to boost investor interest in the mining sector. For instance, between 1984 and 1995, there were significant policy changes and institutional developments that offered generous opportunities and incentives to investors to reflect the new economic paradigm. The establishment of the Minerals Commission in 1984; the promulgation of the minerals and mining code in 1986; the promulgation of the small scale mining law in 1989 and the establishment of the Environmental Protection Agency in 1994 were all aimed at boosting the mining industry in Ghana. In addition to
  4. 4. 4 the regulatory framework developed via the laws and institutions, generous incentives were provided to foreign investors to boost foreign direct investment in mining. Between 1983 and 1998, the mining industry brought approximately US$ 4 billion in FDI to Ghana. At the time, this figure represented more than 60% of all such investments in the country (Ghana Minerals Commission, 2000). The mining sector is credited with bringing Ghana a significant amount of foreign exchange earnings. It has been for the Ghanaian economy a generator of employment, employee income, tax payments, and mineral royalties, etc. It is noteworthy that mining’s contribution to GDP increased from 1.3% in 1991 to an average of about 5.2% between the years 2001-2004 (Ghana Minerals Commission, 2006). The sector’s contribution to the nation’s gross foreign exchange earnings has also increased progressively from 15.60% in 1986 to 46% in 1998. In absolute terms, the sector generated US$ 124.4 million in 1986, and US$793 million in 1998 (Ghana Minerals Commission, 2000). By 2013 the income generated by mining had shot up to the astonishing figure of US$5.6 billion. The sector however, has a relatively limited capacity to generate employment. This is because most of the mining companies in the country have surface mining operations which are capital-intensive with relatively low labour requirements. Although the direct employment generated by the mining industry is a relatively small part of the Ghanaian labour market, it is a very important source of both direct and secondary employment in the regional areas of the main mining regions of Western, Ashanti, Eastern and Brong-Ahafo. The sector has attracted a significant number of sector support companies such as security services, transport companies, explosives manufacturers, and mineral assay laboratories among others in these regions. Mineral production in the country has been on the ascent after the reforms and this is reflected in the export earnings accruing to the state. Ghana recorded a significant increase in all mineral productions in 2005. The same year saw gold taking over from cocoa as the country’s leading foreign exchange earner.
  5. 5. 5 Though the Ghanaian economy is not, by the United Nations definition, a mining economy, the minerals sector has made noteworthy contributions to foreign exchange earnings and Gross Domestic Product (GDP). Currently, Ghana’s mining sector contributes approximately 40% of Gross Foreign Exchange (GFE) earnings and accounts for approximately 10% of GDP (Ghana Minerals Commission, 2014). Indeed, mining remains a key industry for the growth and development of the Ghanaian economy. Ghana has become the preferred destination for most mining investors in recent times. The mining and quarrying sub-sector maintained its position as the foremost contributor to domestic revenue in 2013. According to the GRA, total outflows from the sector to the nation’s purse was approximately GHȻ 1.1 billion in 2013. This amount represented 18.7 percent of direct tax and 14.3 percent of total domestic revenue mobilized by the GRA in 2013. Declines in revenue and profit levels were the main drivers of the subdued tax revenue performance in 2013 as compared to GHȻ 1.5 billion in 2012. (CoM,2014) Ghana has signed up to the Extractive Industries Transparency Initiative (EITI), an initiative of a global standard for improving transparency and accountability in the management of oil, gas and minerals in resource-rich countries. The underlying principle for the concept is the belief that the prudent use of the natural resource well is an important engine for sustainable economic growth that contributes to sustainable development and poverty reduction, but if not managed properly, can create negative economic and social impacts with untold hardships on the citizens who rather should have benefited from the natural resource. Mr. Chairman irrespective of signing up to EITI the country is unlikely to meet the Millennium Development Goal (MDGs) of reducing poverty by half by this year 2015. There is also conclusive evidence to suggest that poverty is acutely pervasive. The country is placed relatively low on the UN Human Development Index, ranking 131 out of 171 countries in 2006 (UNDP, 2006).
  6. 6. 6 There is strong scepticism as to whether the mining sector’s fiscal regime presents opportunities for increased government revenue from the mining sector for Ghana. Many have argued that the current state of the Ghanaian economy does not suggest that there has been a significant positive impact. Mr Chairman, these questions raised above, would be addressed as I give you a perspective of our industry today; and the opportunities it presents us to explore a shift into a new paradigm. CHALLENGES Ladies and Gentlemen, today our industry faces many challenges resulting from 1) unfavourable market forces, 2) incongruent and misaligned policies and 3) personal/partial interests that override general industry interest. All these factors acting in unison and at times independently have undermined our responsiveness to opportunities that are present in the industry. Perception The industry sits in a very enviable position in the national economy. In 2013, gold alone contributed US$5 billion to the state, accounting for 10% of GDP. In the same year, 23 large-scale mining companies contributed up to 37% of total export by producing gold, diamonds, bauxite and manganese. In addition to all these, there are over 300 registered small scale mining groups and 90 mine support service companies. The industry has contributed towards improved social development through providing jobs, paying taxes, building an industrial base, enhancing efficiency, earning foreign exchange and transferring technology. However, it has also been perceived by a critical public as deepening disparities in
  7. 7. 7 wealth; operating under poor labour conditions; polluting the environment; and being responsible for health and safety failings, forced displacement and other human and civil rights abuses. This has led to an increasing pressure from NGOs, Community Based Organisations (CBOs) and Civil Society Organisations (CSOs) all over the world for multinational corporations to become more accountable. Gold Price Mr. Chairman, the bullion slump by 28% in 2013 destabilised the industry worldwide and at home. The decline was mainly a consequence of investors’ waned faith in gold as a store of value amid a rally in equities and muted inflation in the US economy. The effect on Ghana’s industry was a loss of 1.2million ounces of production in 2013. A further potential loss of 300,000 ounces is expected as Obuasi mines (AGA) restructures. The accompanying labour rationalisation and cost restructuring exercises of other members of the Chamber of mines and suppliers has had an enormous toll on the industry. It is estimated that more than 4,000 jobs were lost in the past year or two. As we are gathered here, I believe most of you have experienced one way or another the brunt of the goings- on of the restructuring exercise. Mr. Chairman, the bullish DJIA has lately been responsible for a bearish bullion market. As a consequence, funds for the development of gold and other mineral projects have significantly dried up. The trend has affected the gold stock, causing miners to react with drastic retrenching and cost-cutting measures in order to be able to stay afloat in the business. (Refer graphs 1 & 2) Graph 1
  8. 8. 8 A comparison of Dow Jones index averages (DJIA) and the gold price over 45 years indicate that the price of minerals have risen in nominal terms. Yet in real terms, as measured by (London Bias) LBMA, this development represents an investment loss (AM-PM). A study of the seven top gold producers in the world confirms negative returns to shareholders. It is pertinent to point out further that the strong market performance indicated by DJIA belied the reality that the metal price was not high enough and thus gave miners very little margin to make errors. Current operational planning globally by major players anticipates gold price at US$1300 - 1500, but this is significantly above the current market price of sub US$1200. Environmental Awareness In addition, the environment has become paramount, a key determinant of how much operating room the industry is permitted. The environmental law enjoins miners to obtain environmental permits before mining commences even though they may have a mining permit. That is to satisfy stakeholders that all impacts have been identified and the relevant remediation planned to mitigate them. Miners can no longer relocate their business to take advantage of underdeveloped environmental laws in another jurisprudence. Governments have become more aware of the environmental needs and hopefully are continually reviewing their policies to protect the earth. E.g. The posting of environmental bonds is an innovation after the Resolute Amansie incident. We must understand that the global earth protection campaign has caught up with every location worldwide. The demand to show exceptional responsibility in environmental and safety issues is eminent.
  9. 9. 9 Now, it is in the interest of miners to develop operational methods that are environmentally friendly or go bust. Ladies and gentlemen, the earth has been re-enthroned King and the mining world needs to acknowledge it. However, in Ghana we are still grappling with the earth’s regained status. Our leaders look on helplessly at the destruction of our lands and water bodies by galamsey mining. Power Ladies and gentlemen, another challenge is the infamous Dumsor. Our industry consumed about 10- 15% of power generated in country at the turn of the millennium and guaranteed the power providers adequate revenue for maintenance and upgrade. Today, notwithstanding the high tariffs, power supply is inadequate and the power supply landscape is characterised by rationing of power. The absence of reliable power from the national grid and the lack of a cheaper source thereof continue to unbalance miners’ resolve to keep afloat with the increase in operating costs; independent power generation is the norm rather than the exception. The power supply is inadequate because Government has not made provision for either the public or private sector to make new investments. At present, there are many ad hoc solutions that are being formulated: the Karpower, the APR etc. This has been the norm during periods of crisis. What is missing has been a coherent, well-formulated approach that addresses the fundamental risks of electric power provision in the country: foreign exchange risk; fuel supply risk; the credit-worthiness of ECG. While the mining sector typically pays more than a cost-reflective tariff, other sectors of the economy do not: the result of the pricing discrimination is that, overall tariffs set by the PURC are not cost-reflective. Worse, Government does not pay its bills. The electricity sector is essentially
  10. 10. 10 insolvent. Until Government pays its bills, and tariffs are properly set, the Government will struggle to provide an environment for sustainable provision of electricity. For the private sector to meaningfully participate, it needs clear signals from the Government and regulators about the rules of the game. The current approach is that whoever wants to do a project is encouraged. Hence FDI and IPP’s have monopolised the power space, leaving little participation for the Ghanaian economic player. In other countries, they put out tenders, and they do auctions. Based on this approach a country is able to systematically say, for instance: our target of 1,000 MW is being met as follows, by the following projects, and that so and so bid in at lowest cost etc., and so and so has this much gas and fuel need, and needs this much credit support, etc. The rules can also mandate that local content is a requirement for any foreign participation. It is gratifying to note, however, that the Cenpower power project, a 340 MW project that is under construction, was started by local Ghanaian entrepreneurs. One cannot emphasise enough that local participation is a good thing for our country and should be further encouraged. Gensa is another example. The mining sector can play its own role to catalyse new investment – by serving as anchor loads for new power projects. This role may potentially free up power related investment capital in the mining budgets towards other productive and efficient investment needed to boost the industry. This is a subject that the World Bank has recently written on –and it is a role that the mining sector should seriously consider. Mr. Chairman, ladies and gentlemen, I would at this stage humbly propose that players in the mining industry be proactive in initiating a 25-year power agenda with regulators and power providers. The objective will be to lock-in and secure the power requirement necessary for the smooth performance of the industry. It is in our vital interest to take this path; we must after all secure our productive future or risk going under. In that case, I would like to see the Chamber of mines and
  11. 11. 11 AMN doing effective lobbying and advocacy work to ensure that what is in our common interest receives persuasive hearing and demonstration in the policy-making chambers of this country. Not only that: we must also be ready to put our money where our mouth is in order to guarantee that what will work in our interest gets concretely realised. Water Water availability is another challenge confronting the industry. Water has been taken for granted in the past as a given. This is pointed out in the report Charting our water future (2008), a report whose sponsors included: The Barilla Group, a global food group; The Coca-Cola Company, a global beverage company; Nestlé S.A., a global nutrition, health, and wellness company; SABMiller plc, a global brewer; New Holland Agriculture, a global agricultural equipment company; Standard Chartered Bank, a global financial institution, and Syngenta AG, a global agribusiness. Notably absent from the list of sponsors is a mining company. The research envisages a worldwide water gap of 40% by 2030, with higher shortfall up to 50% in developing countries. In Ghana, it is anticipated that the country risks importing water earlier than this date if things stay as they are. The gross environmental degradation and pollution of our water systems resulting from our mining activities (legal or illegal) is an irresponsibility by our industry. Ladies and gentlemen, since I got involved in the water sector recently, it has become something of an embarrassment to me to see how culpable our industry is in the pollution and degradation of water systems in this country. This is simply indefensible. We cannot exonerate ourselves by simply saying we have done our bit—or by shifting all the blame on to actors operating illegally in the industry. We are culpable as managers for failing to act effectively to arrest this situation and avert a potential crisis. Water may be the source of our next major crisis after power. Our industry uses a minimum water ratio of 1:1 for mining and for processing. We need to actively identify, influence
  12. 12. 12 and operationalise policies to protect this resource or else we risk escalating our production costs, and in the worst case our own extinction. As an industry, we need to lift water up to a parity of gold or other minerals and monitor it from its prospecting to its processing phases. Our collaboration with governmental bodies like WRI, Mincom, EPA and WRC must be a sine qua non. Reciprocity is needed from these regulatory bodies acting on behalf of government to motivate miners to innovate and plan out systems that would address this potential water crisis NOW! Mr. Chairman, I would like to encourage our industry through the Chamber, to show presence in cross-sectoral studies on water; and to develop a water policy guideline for the industry that guarantees quality and quantity for our purposes. Cost of Inputs Increasing input costs and more stringent demands on mine management throws a challenge to miners to evolve innovative ways to stay in operation in these times. Higher input costs—in tandem with other challenges—not only adds on to the cost of production, it also creates a lot of instability and insecurity in the industry. With the increasing cost of mining and processing inputs and services and the stringent reporting and disclosure required by the stock exchanges, it is no longer enough to only reduce the workforce and renegotiate supplier input prices to stay in business. Mr. Chairman, our industry will require to dig deeper into its knowledge pool to find new ways to address these and other challenges identified. Productivity driven and process ownership strategies at every facet and stage of the industry should be the norm. WAY FORWARD
  13. 13. 13 Ladies and gentlemen, in exploring the way forward amidst the changing dynamics of the industry, developing economies and labour organisations—i.e. trade unions—have by now come to terms with the reality that it is no longer prudent to design operations that require large workforces. Rather industry managers (which include regulators) would have to re-evaluate their socio- cultural environment and apply all relevant tools from their financial and organisational engineering tool box to design and promote attractive systems and incentives via laws and policies to create the next wave of economic recovery. It is worth noting that in the new dispensation qualitative assets— organisation, motivation and self-discipline—will succeed land, labour and capital as differentiators of economic performance. To make this a reality AMN should continually create fora to engage the regulators, miners represented by the Chamber of mines (whose core objective is to promote and protect the interest and image of the mining industry). AMN should present paradigm leap researches and papers that will challenge and motivate our industry actors to keep awake and to deliver a continually self- renewing industry. Role of Policy The role of policy cannot be over emphasised in attaining this shift in paradigm. We agree that the role of government is to create the enabling environment through the policy and laws, hence the role of our regulators is essential if we are to make a huge impact on the economy as SA did years ago. The challenge to our regulators is to re-examine policy and laws to ascertain their currency—i.e. whether they make for investor competitiveness, environmental responsibility and cost effectiveness of operations. That is not to propose that standards be lowered. Far from it. As policy watchdogs you may constantly engage and assist operators to understand the need to champion the economy through appropriate use of policies. To achieve this feat I suggest a one-stop shop be created to promote the permitting and licensing of mining. We need to aspire to attain transparent
  14. 14. 14 disclosure of our licensing and other processes. We can improve on our ease of doing business position in the world. The shift in paradigm would require reinforced leadership of the Chamber of mines to be in sync with membership aspirations; with the view to catapulting the industry to uncharted heights well above the 1983 ERP targets. I challenge actors of the industry to place activities of the Chamber high on their agenda and get actively involved in development of the Chamber to meet the new challenges of the industry. We are greater singing together as a choir than as soloists. A paradigm shift calls for a review and total scrutiny of the local content law, the royalty law, and windfall tax etc. and its implementation procedures. Government may no longer take the path of least resistance to enact fiscal regimes or laws to increase its revenue to the peril of the industry. It is enjoined rather to create innovative policies to create a win-win scenario for both industry and state. As a caution, it is worth noting that today no country in the world contributes more than 14% of the world gold production. Gold in spite of its scarcity is now found in many countries. May I suggest that the Chamber roll out policies to guide the development of a strategy for some of the challenges outlined? For example a chamber policy on water should assist our industry to focus on water strategy for mining. It should also create linkages with other sectors of the economy so as to actively influence the development of the national policy discourse. We can thereby take advantage of these synergies to create local content initiatives. Local Content LI 2173 Mr chairman, the local content law LI 2173 places emphasis on three areas for now, viz. 1) recruitment of expatriates and promotion of local workforce; 2) procurement of locally produced goods and services; and 3) additional licensing and reporting requirements. It is a fact demonstrated in many publications that procuring locally has the potential to rake-in more returns to the economy
  15. 15. 15 than royalties, etc. The current acceptance and implementation of the procurement route in the Local content law may be laudable; it is phased and tries to identify growth poles for the development of manufacturing bases with quality assurances. However, this approach is not far- reaching in the ways it allows local participation in the mining industry. The local content approach taken now is usually effective in countries with a good manufacturing base. We have little or no indigenous manufacturing base in this country to leverage procurement to exponential advantage. The PNDC Law 153 of 1986 couched the idea explicitly; however we never realised it in the procurement path. This outcome was perhaps due to the absence of the requisite LI, or to an operational environment that was not appropriate. The new law 703 is accompanied by LI 2173 this time around; but this law, like many other Ghanaian statutes, is punitive and not motivating. Ladies and gentlemen, the congenial fiscal regime need to kick start the implementation of the LI 2173 is absent. The nation’s economic fundamentals should be such that they allow “greater efficiency on the part of domestic entrepreneurs in responding to the support service requirements of the industry”. I personally do not ascribe to the view that individual local companies can leverage opportunities and raise adequate capital from our ‘small or poor’ banks and insurance companies. In 2007, Kwame Pianim stated that “For fuller operational linkages between the mining sector and the national economy, the domestic private sector needs to mature, become more dependable and to scale up its operations to be worthy of being entrusted with some of these supply requirements of the sector. For example, the capital requirements of mines tend to be by far bigger than any single domestic bank’s single obligor prudential requirements would permit it to supply”. He stated that “we need to scale up the operations of the commercial banks, and get interest rates lower to international capital markets’ level before being able to attract domestic borrowing”. That is the way to go if we genuinely want to engender credible local substitutes and competitors for the multinational mining firms.
  16. 16. 16 Mr. Chairman, the call by the Chamber of mines for FDI in the provision of inputs for our industry at the Indaba in SA this year attests to the argument above. To enhance the LI 2173 implementation as it stands now, I suggest that fiscal policy should target growth poles and sponsor them to accelerate their development. This strategy was adopted by the Asian tigers in the creation of Hyundai and others. Dangote of Nigeria and many Nigerian banks are beneficiaries of similar policies. The LI 2173 differs from the oil industry’s Local content bill in terms of licencing and ownership amongst others. I suggest the laws be harmonised to reflect active intent in line with the EITI principles. In the end the LI 2173 appears cosmetic in creating ‘political empowerment’ instead of ‘economic empowerment’ needed in the industry for the participation of the Locals. It is when economic decision making is ‘locally contented’ that the full benefits of the law can be realised. This is different from local management as it exists Ghana or BEE as in SA. Research shows that Africa in the not too distant future would transit from a purely resource based economy to a “knowledge based” economy. This is a threat, and also an opportunity for us to position our industry. Are we ready to rise up to the opportunity the mining landscape presents? It presents an opportunity for us to formulate focused, effective and intended strategic policies to harness the transition, as well as catapult our human resource pool into relevance in the new economic dispensation. With 30% of the world’s mineral resources in Africa we would need to leverage all resources to strengthen our mining industry. Regulatory bodies which in the main act on behalf of government, the Chamber of mines and the NGOs like AMN would have to work together tirelessly to bring our many opportunities to fruition. These bodies need to develop their capacity and abilities (technical and managerial) to harness the exponential growth to significant local advantage.
  17. 17. 17 Mr. Chairman, I am strongly convinced that our industry has a great deal more to offer to our nation in its developmental agenda. As players of the industry we are challenged to rise above our personal interests, to forge a new and focused agenda that would bring on the next wave of economic enhancement and social advancement. We must actively purpose to create sectoral linkages to work to positively influence the national economy The industry as a matter of urgency must promote a focused strategy and policy to embrace technology and knowledge-based economic indices to promote a paradigm shift. Scientific knowledge and appropriate technologies hold the keys to resolving the economic, social, and environmental challenges we face. A coherent, revolutionary policy on science and technology is required of us. Ladies and gentlemen, a country that does not uphold research is doomed. Likewise our industry. The chamber of mines and AMN should continue to forge alliances with research bodies and regulators to bring research based knowledge to the industry. The re-focusing of the Chamber of mines is vital in the paradigm shift of the industry. The Chamber must be encouraged to shift gear from reactive to proactive strategizing that addresses the medium to long term growth of the industry. It may be proper to have a policy on every relevant issue to serve as a guide in the operations of the Chamber. It is advised to be seen to be sponsoring bills and research that address the growth and sustainability of the industry. For example the Chamber should spearhead water, power and education agenda to make resources available in quantity and quality to support our industry. AMN and other relevant NGO’s are encouraged to constantly prod the Chamber and other players to stay focused. Mr Chairman, our industry’s achievements are worth emulating by other segments of the economy, but we remain in obscurity and pride ourselves therein. For this reason we are only seen as a
  18. 18. 18 bankroller to the nation (you mention that you are a miner and people think Money). Our safety records and safety management systems are worth noting. The mines inspectorate has been very successful in the implementation of the mining regulation to the extent that it has given the industry’s safety record international recognition and envy. Mr Chairman, the June 3 disaster could have been avoided if we had a strong inspectorate institution akin to what we have in our industry. I therefore suggest that government and industry players initiate the formation of a national inspectorate board whose responsibility is to ensure all industrial and developmental safety. This independent body shall be backed by the relevant legislation that would enable it to ensure safety in the nation. AMN should copy the obsolesce principle in the technology industry by forming alliances with research bodies like STEPRI- CSIR to identify and bring to the fore obsolete laws, policies and practices so as to continually keep the industry at the cutting edge of national development. These changes should provide doses of the L-waves (shock) that would keep actors out of complacency and slumber. Conclusion In concluding ladies and gentlemen, I have identified that a paradigm shift in policy amongst others may propel our industry to the economic pinnacle in the next quarter of the century. In the process I have suggested that ‘local economic empowerment’ rather than ‘local political empowerment’ would enhance the industry’s contribution to the national economy. In the main, the industry has the required institutional structures for a take-off into the new paradigm. However some tweaking is required to make culture and values the new source of economic advantage. Therefore, as industry players, we should make it our business to know about, support and inspire our industry’s future in this vein. I believe that there is a renewed energy from today. It is indeed our onerous responsibility to make our industry rise to the pinnacle of the National economy.
  19. 19. 19 The Chamber of mines and AMN are encouraged to be seen to be creating and championing this agenda. They should harness the energies of all their membership within a common strategy to address the agenda for the next 25years. Mr Chairman, ladies and gentlemen, the mining industry is well placed to script a bright future for our country and for Africa at large. We are poised to make our future a reflection of our glorious past. We have been there before; we are surely and confidently on our way there again. Lastly, to ride the wave of the new paradigm, we need to act differently. Our agenda will require us to grow many tentacles to link up with others. That way we will be engaging in the productive sectoral intercourse and cooperation that will put us on course to re-capture the commanding height of the nation’s economy!! Long live AMN, Stronger be the mining industry, God bless Ghana, and Thank you.

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