Ghana is moving forward with a new sliding-scale gold royalty system designed to boost the country’s share of mining revenues, despite objections from some foreign governments and major mining companies.
The policy, effective Tuesday, replaces the current flat five per cent royalty on gold with a price-linked structure that increases the state’s earnings when global gold prices rise.
Under the new framework, gold miners will pay royalties of up to 12 per cent if prices reach $4,500 per ounce, according to Reuters. This comes as gold is trading above $5,000 per ounce on international markets.
The reform is part of a broader push by Ghana and other African nations to secure a larger portion of revenue from their natural resources amid rising commodity prices.
However, the move has drawn criticism from several diplomatic missions and mining industry executives, who warn it could deter investment in the sector.
Last week, Reuters reported that the United States, China, and several Western governments coordinated efforts to convince Ghana to delay the policy.
Despite the pressure, Isaac Tandoh told Reuters that Ghana would implement the reform.
“They met us; they are not against the review in principle,” he said, noting that foreign representatives raised concerns about the top 12 per cent rate but did not oppose the overall shift.
Some diplomats suggested that the maximum royalty should only apply when gold prices hit $5,000 per ounce, a proposal Ghana rejected.
The reform also introduces a sliding-scale royalty system for lithium, with rates between five and 12 per cent depending on market prices. Lithium royalties will apply to prices ranging from $1,500 to $3,200 per metric tonne, while other minerals will retain a flat five per cent rate.
Industry leaders warn the higher royalties could influence investment decisions. Executives from major gold mining companies have cautioned that the policy may hinder future projects in Ghana.
Ghana Chamber of Mines expressed similar concerns. CEO Kenneth Ashigbey said the policy could “dry up new projects and output.”
Mr. Tandoh dismissed fears that Ghana would lose its competitiveness, saying government models indicate the sliding-scale system balances higher state revenue with reasonable investor profit margins.
He added that investors are often more concerned with regulatory certainty than modest increases in operational costs.