The Institute of Economic Affairs (IEA) has kicked against the government’s proposed sliding-scale mineral royalty regime, describing it as a continuation of a “colonial” framework that prevents Ghana from fully benefiting from its natural resources.
In a statement issued on Tuesday, the policy think-tank criticised the draft Minerals and Mining (Royalty) Regulations, 2025, which seek to introduce royalty rates ranging between 5 and 12 per cent for minerals such as gold and lithium, alongside a flat 5 per cent charge on diamonds, bauxite, manganese, salt, limestone and iron ore.
The institute also raised concerns over reports that the Ministry of Lands and Natural Resources is considering a separate bill proposing a 9 to 12 per cent sliding-scale royalty across the mining sector.
The IEA described the Ministry’s posture as “confounding and contradictory” to President John Dramani Mahama’s public commitment to resource sovereignty.
According to the institute, President Mahama has consistently signalled a departure from traditional extractive models that offer limited value to resource-rich countries.
It recalled that in March 2025, the President aligned himself with former Chief Justice Sophia Akuffo, arguing that mining agreements must be reviewed because “Ghana must earn more from its natural resource endowment.”
At the United Nations General Assembly in September 2025, Mahama reiterated that “Africa must exercise sovereignty over its natural resources,” stressing that the era of handing vast concessions to foreign interests “must come to an end.”
The IEA further cited remarks made by the President at the World Economic Forum in Davos in January 2026, where he lamented:
“We supply the world’s critical minerals but capture almost none of the value. This isn’t sovereignty. It is a trap.”
Against this backdrop, the institute said the Ministry’s proposal falls short of the President’s broader vision.
“Whereas the President has moved on, the Minister of Lands and Natural Resources is still propagating the old colonial royalty-based paradigm,” the statement said. “The President is ahead of his Ministers!”
The IEA argued that royalty systems, whether fixed or variable, are structurally weak because they cede ownership and control to foreign firms while Ghana receives only a fraction of the value generated from its own resources.
Instead, the institute proposed a model of full national ownership, under which the state retains control of mineral resources and engages private companies—local or foreign—strictly through service contracts.
It noted that similar frameworks have yielded positive results in countries such as Norway, Botswana, Chile, as well as several OPEC and West African states.
“National ownership and effective management of Ghana’s resources would yield financial, economic and national security dividends far exceeding any royalty percentage,” the IEA stressed.
With several mining leases expected to expire in the coming years, the institute said Ghana has a rare opportunity to reset its mining framework without breaching existing agreements.
“We urge the Government not to renew expiring leases, but instead to pursue a new trajectory anchored in state ownership and the use of service contracts,” the statement added.
The IEA also dismissed claims that Ghana lacks the capacity to manage its own resources, pointing to the availability of trained professionals and Ghanaian-owned mining firms already operating in the sector.
“What has been lacking is the political will to act decisively,” it concluded.
The statement ended with a firm rejection of the Ministry’s proposed royalty reforms and a full endorsement of President Mahama’s sovereignty-driven agenda.
“Ghana must abandon the colonial course of giving away ownership rights to foreign companies,” the IEA declared, urging a transition to a modern framework that guarantees “full national ownership for the good of Ghana.”
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Read the full statement below:
