Extractive sector players shirking transparency duties

By Kizito CUDJOE

Co-chair of the Ghana Extractive Industries Transparency Initiative (GHEITI), Dr. Steve Manteaw, has voiced concerns over ongoing lack of accountability and transparency among several key entities in the country’s extractive sector.

This comes amid ongoing challenges faced by GHEITI in the reconciliation process, which aims to ensure responsible management of the country’s natural resources.

“Data accessibility was a major challenge in undertaking this particular reconciliation. An entity like the Environmental Protection Agency (EPA) did not provide data at all,” he said, expressing concern that this lack of transparency could indicate either poor data management or an attempt to conceal information.

Dr. Manteaw, who was speaking in an interview after the launch of GHEITI Report for 2021-2022, also noted specific issues with FGR Golden Star Resources Wassa which provided data for 2021 but not 2022.

In contrast, he added, Vitol has consistently refused to participate in the EITI reconciliation exercise. However, Dr. Manteaw commended Petro-SA on providing data for the first time.

The implications of such non-compliance are severe: “When entities do not provide data, it means we don’t get to know how the resources that belong to all of us are being managed,” Dr. Manteaw explained.

This opacity undermines the very purpose of transparency initiatives, which aim to empower citizens with information to demand accountability.

Dr. Manteaw also shed light on challenges faced in obtaining data on the Additional Mineral Royalty for Mining and Forest Reserves, managed by a committee called the Liaison Group which is hosted by the Forestry Commission.

He said efforts to ascertain the amount of revenue collected and its utilisation have been fruitless. “Even though we are seeing some transparency in the management of our natural resources, certain sections of the industry remain opaque,” he said, urging the Liaison Group and Forestry Commission to be more transparent.

He also called on the EPA to disclose the substantial amounts of money they collect for various services. “Ghanaians have a right to know how much they are collecting and how these monies are being used,” Dr. Manteaw asserted.

The 2021-2022 GHEITI reconciliation reports for mining, oil and gas brings to 29 the total number of reports published since Ghana acceded to the initiative. It is made up of 18 mining and 11 oil and gas reports. It also closes the reporting gap that emerged following the sudden demise of former GHEITI Coordinator the late Bashiru Abdul Razak, which disrupted the GHEITI work programme in 2023.

Following the grant of a six-month extension on grounds of extenuating circumstances that faced GHEITI in 2023 and which combined to delay production of the current reports, MSG has worked assiduously to meet the new reporting deadline.

Highlights of the 2021-2022 GHJEITI reports:

Mining
1. The mining sector’s contribution to the country’s Gross Domestic Product (GDP) declined from GH?11.449billion in 2020 to GH?10.105billion in 2021 representing a decrease of 11.7 percent, and increased to GH?13.025billion in 2022 representing a 28.9 percent climb.

2. In 2021, the country’s gold production shrunk by 91.7 percent, mainly due to the introduction of a 3 percent Withholding Tax on small-scale production of unprocessed precious minerals. Government’s decision to halve the impost rate from 3 percent to 1.5 percent spurred a recovery reflected in the 569-percentage increase in official records on the small-scale sector’s output in 2022.
3. Relative to other sectors, the mining sector was the fifth largest economic activity by value in 2021 and third in 2022.
4. Mineral export proceeds in 2021 and 2022 represented 36 percent and 39 percent of total merchandise exports respectively, which were more than the contributions of other major forex earners such as cocoa and crude oil.

Oil and Gas

5. The upstream oil and gas sector in Ghana contributed 4.89 percent to the Gross Domestic Product (GDP) of Ghana, 6.91 percent of total government revenue and 7.03 percent of domestic revenues in 2021
6. A total 11,615,029 bbls of crude oil was exported by GNPC in respect of CAPI and royalties for an amount of US$496,286,198.
7. The other partners exported 55,843,177 bbls of crude in 2022. Thus, the total crude oil exports for 2022 as reported by the Bank of Ghana was 67,458,206 bbls valued at US$2,910.6million. This translates into 31.19 percent of total merchandise exports in 2022. In 2021, the total value of crude oil export was US$3,947.73million, which accounted for 26.81 percent of gross merchandise exports.

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