Ghana, which is in the West Africa, is bordered by the Ivory Coast, to the west, Burkina Faso to the north, Togo to the east, and the Gulf of Guinea to the south. The country has a population of over 34 million people, with Accra being the capital city. Ghana has a mixed economy with a combination of free market principles and government intervention. The country’s economy is driven by the services sector, which accounts for around 60% of its Gross Domestic Product (GDP) .The industrial sector accounts for around 25% of GDP, while agriculture accounts for approximately 15%.Ghana is a peaceful country, Switzerland of Africa and largely composed by young people which contribute a pool of cheap labor open to education and professional and vocational training therefore abided to freedom and human rights obligations. Ghana offers a very supportive investment environment to foreign investors. Ghana is an open socially and political country members of among regional and international organizations. Ghana is rich in natural resources, including gold, diamonds, oil, and cocoa, which are major contributors to its economy. The country is the world’s second largest –producer of cocoa and a significant producer of gold, bauxite, and timber. Ghana is an economy that can never be over looked when talking about mining, being it gold, bauxite, diamond, manganese, salt and the latest addition lithium it even copper.
Mining is a major contributor to Ghana’s economic growth if not the main.
In 2022 Ghana became the number one gold exporter in Africa and 11th worldwide.
Export of gold alone contributed about GHC 14 billion to the country’s GDP in just 2023.
Mining in Ghana is such a lucrative venture worthy of an investor consideration.
GOLD: there’s a wide range of gold deposit in Ghana in almost all the regions, but currently the Western, Eastern, Ashanti and Ahafo regions are areas where gold is being mined most especially on a small scale level. Newmont, Goldfields and Anglo Gold Ashanti are companies operating on a large scale.
BAUXITE: Ghana Bauxite Company is the sole manager of Ghana’s bauxite deposit at Awaso in the Western North Region.
Bauxite mining in Ghana has been in existence since the 1940s. The Ghana bauxite company is a fully Ghanaian owned company that produces about 1.2 million tons of bauxite annually and it’s exported through the Takoradi port.
DIAMOND: The Birim Valley, Akwetia in the eastern region is where Ghana’s diamond deposit can be found. Though operation has gone down currently, but it’s estimated that about 100 million carats of diamond has been generated since its inception in 1919.
Ghana Consolidated Diamond (GCD), a government owned entity is the manager of the mineral deposit. There are small scale miners also present in the region. In 2022 alone, export of diamond contributed $ 4.85 billion to economic growth of the country.
MANGANESE: Ghana is a leading producer of manganese and number four exporter worldwide. An open cast strip mining technique is what’s used in the operation of manganese at Nsuta, Tarkwa in the Western Region enclave of Ghana. Manganese is known for the production of stainless steel and Ghana has a large deposit of it. Manages mining has been existence since 1916, with the concession covering an area of about 170 square kilometers.
LITHIUM: Call it the “new kid on the block” because commercial lithium was discovered in Ghana just recently in 2018 by Atlantic Lithium with the concession located at Ewoyaa in the Central Region of Ghana. Commercial operation is set to fully start by the second quarter of 2025 and Atlantic lithium promises to make Ghana a leading lithium producer in the world.
COPPER: Ghana derives copper from scraps, and also import from other countries like Germany, Cote d’lvoire and India and also copper ore from China and Namibia to meet its copper needs. Though the country has some amount of copper deposit it’s not as flourishing as the other minerals. Ghana refines copper and export it back to China and Germany.
SALT: Salt deposit in Ghana can be found in Songor Lagoon, Keta, Salt pond and other coastal areas. The industry basically relies on solar evaporation of sea water for its salt production.
The industry though underutilized, generates approximately 250,000 metric tons of salt annually. Research have shown there could be an increase of 2 to 3 million tons in production per annum and $ 1 billion foreign exchange annually.
Why invest in the mining sector of Ghana? :
- Strong investor friendly regulatory system:
There’s an introduction of foreign ownership rights which gives some form of security to a foreign investor. There’s also tax and customs duty incentives. Example is Atlantic lithium securing a $ 6.7 million deal for the operation of ewoyaa lithium project while Ashanti Gold invested a whopping $ 525 million for the expansion of the Chirano and Bibiani mines.
The green mineral policy which came about in 2023 aimed at streamlining entry for critical mining investors.
2. Skilled Workforce:
There’s an availability of a large number of human resource ready for the mining sector in Ghana considering the fact that mining is an old venture in the economy’s history.
Institutions like the World Bank have partnered with miners to create initiatives that will equip them with modern sustainable mining practices, example is the Ghana landscape restoration and small scale mining project.
3. Infrastructure Readiness:
A mining investment hub that has been sustained over the years, hence the availability of mining infrastructure.
The ministry of land and natural resources in 2023 collaborated with testing laboratory company Intertek to launch a new testing laboratory in Tarkwa. There was also an inauguration of Royal Ghana gold refinery in Accra in August 2024. This allows for local gold processing, streamlining operations and boosting export revenues through the sale of refined gold.
Challenges of the mining sector in Ghana:
Below are a few challenges holding back the mining sector in Ghana
- Regulatory and Institutional red tape, high interest and inflation rates, fluctuation of the value of the local currency compared to the US dollar etc.
- Illegal Mining (galamsey): Illegal mining is not well structured and therefore poses a lot of risk in terms of health, the use of mercury can be detrimental to health of the miners causing sicknesses like kidney diseases, liver etc. It again brings about environmental degradation as mining is usually done in rivers, destroying the water bodies and then also destroying forest reserves just to pave way for mining activities.
- Transport, Energy and Logistics Infrastructure: Lack of good roads and transport networks can play a factor in transporting mining equipment’s and can increase operational cost. There’s also a concern of stable electricity and power supply, a costly power supply can affect the smooth operation of mineral processing plants by mining companies.
- Industry Regulatory Institutions:
- Ministry of Lands and Natural Resources
- Minerals Commission of Ghana
- Forestry Commission of Ghana
- Ghana Gold Board
- Environmental Protection Authority
To conclude it all, with everything being said above, Ghana definitely is the go- to country for any investor who wants to venture into the mining industry. Though a few cons but the pros surely outweighs the cons. Whichever option you choose being it gold, lithium, salt, diamond, bauxite etc., there could be a big reward waiting the potential investors to peaceful and democratic Ghana .
