Ghana’s gold industry is on the brink of a major transformation following the passage of the Ghana Gold Board Act by parliament. The Act is now awaiting approval from President John Dramani Mahama. Once implemented, it will replace the Precious Minerals Marketing Company (PMMC) with the newly created Gold Board.
While both institutions share comparable core duties, the Gold Board is set to bring in significant new functions that could transform gold regulation, marketing, and small-scale mining in the country.
The High Street Business, after the passage of the bill, has scrutinized both bills and identified the similarities in functions and the additional responsibilities the new Gold Board will bring on board to enhance gold management.
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Similar Core Functions
The PMMC has long played a pivotal role in Ghana’s mineral sector, particularly in the grading, valuation, and processing of precious minerals. The institution was also tasked with buying and selling gold, promoting the jewelry industry, and ensuring quality assurance in gold trading. These functions will not disappear under the Gold Board; rather, they will be carried forward and expanded to align with international best practices.
The Gold Board, like PMMC, will set standards on the quality, purity, and weight of gold sold or exported, ensuring compliance with global gold trade requirements. Additionally, it will continue efforts to promote value addition by regulating the downstream fabrication of gold into castings, coins, bars, and other value-stored products.
The Gold Board’s Enhanced Mandate
However, where the Gold Board significantly diverges from the PMMC is in its broader and more interventionist approach to Ghana’s gold sector. Unlike PMMC, the Gold Board will have the mandate to:
Government Pre-emption Rights: The Gold Board will have the authority to buy a portion or all of the gold produced by large-scale mining companies in line with the government’s pre-emption rights under the Minerals and Mining Act, 2006. This function strengthens government oversight of the country’s gold resources.
Small-Scale Mining Formalization: The new institution will actively support the formalization of small-scale mining, ensuring responsible sourcing, supply chain sustainability, and traceability of gold. This is a crucial step in addressing the widespread illegal mining (galamsey) and its associated environmental and economic challenges.
Support to Small-Scale Miners: Unlike PMMC, the Gold Board will collaborate with the Ministry of Mines to provide geological investigations, concession viability assessments, and equipment financing to small-scale miners. This initiative is expected to boost legal mining activities and reduce illicit gold trading.
Combating Gold Smuggling: The Gold Board will develop and implement robust measures to tackle gold smuggling, a menace that has led to significant revenue losses for the country. This function was not explicitly outlined under PMMC’s mandate.
Sustainability and Environmental Practices: A notable addition to the Gold Board’s responsibilities is its focus on environmentally sustainable mining practices. With growing concerns over the impact of mining on land and water bodies, this function seeks to ensure that mining activities adhere to sustainable principles.
Joint Ventures and Commercial Arrangements: Unlike PMMC, which was primarily focused on buying, selling, and processing, the Gold Board will have the power to engage in joint ventures and other commercial arrangements to enhance the country’s gold sector.
Implications for Ghana’s Gold Industry
The establishment of the Gold Board signals the government’s intent to tighten regulation in the gold sector while maximizing revenue and improving sustainability. With a more hands-on approach to supporting small-scale miners, the new framework could help curb illegal mining and increase formal gold exports.
Furthermore, the Board’s pre-emption rights over large-scale mining output suggest a stronger government presence in the gold trade, which may have implications for private sector players. This move could ensure greater local beneficiation and value retention, reducing the outflow of raw gold without sufficient local processing.
The battle against gold smuggling will also be intensified, potentially sealing revenue leakages and improving Ghana’s fiscal position. However, successful implementation will require strong enforcement mechanisms and collaboration among government agencies, miners, and traders.
Although the core functions of the Gold Board mirror those of the defunct PMMC, its expanded mandate makes it a more comprehensive and strategic institution for managing Ghana’s gold resources. As the Gold Board takes center stage, the challenge will be ensuring that it delivers on its promises of sustainability, formalization, and value addition.
Source: Accra Street Journal
Disclaimer: Some content on The High Street Business may be aggregated, summarized, or edited from third-party sources for informational purposes. Images and media are used under fair use or royalty-free licenses. The High Street Business is a subsidiary of SamBoad Publishing under SamBoad Business Group Ltd, registered in Ghana since 2014.
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