Beware Lest You Turn The ‘Gold Coast’ Into The ‘Mud Coast’!

 

The idea of establishing a gold refinery in Ghana is not new. It was one of the projects that the Nkrumah Government considered, in line with the industrialisation programme devised for that government by the Noe Drevici group. (GOOGLE Drevici Ghana)

Drevici told Nkrumah (in a conversation revealed to me by Drevici’s wife, Ulla: “Do you know that although Israel does not produce any diamonds, it refines diamonds and makes huge profits out of them? The same with gold!”

Had the 1966 coup not intervened, it is certain that Nkrumah would have built Ghana a gold refinery. Whether it would have been sustainable, or turned out to be white elephant (such as the cocoa storage silos at Tema), we can’t tell.

But establishing a fully integrated gold industry in an undisciplined country like Ghana would be a major (I hate the word but it will have to do!) challenge! What sort of price mechanism would govern the gold products? Would smuggling and ancillary practices dog the gold market and make the corruption scene even worse?

Most important: how would the existence of a gold refinery on Ghanaian soil affect the galamsey ‘industry’? Even without a gold refinery, governments in Ghana have found the smuggling of goods so abhorrent that if I remember rightly, one military government decreed the smuggling of gold “a capital offence.”

But – I ask you – will the existence of a gold refinery here not make it easier for galamseyers to flog their stuff? And if the demand for gold thereby increases in quantum, thereby hiking gold prices automatically (supply -and-demand!), won’t the galamseyers seek to increase their production, in order to benefit from the increased gold price?

The socio-economic problems that will arise cannot be easily forecast, but no matter how hard we try to turn ourselves en masse into identical copies of “Bishop-Know-Everything”.

I believe we are setting ourselves up for a shock, because empirical evidence exists to demonstrate to us that our people can turn into conscienceless, amoral automatons given the right economic incentive.
I mean would you have ever believed it, if someone had told you that there could be a government operating in Accra and yet there were people cutting down COCOA TREES and making it difficult for the Ghana COCOBOD to fulfill its obligations to international cocoa traders to whom the COCOBOD had sold cocoa beans “forward”?

Such sales commonly take place on commodity markets. A cocoa trader (chocolate manufacturer or cocoa grinder) approaches a “producer” country’s marketing arm and says, “I would like to buy X tons of cocoa to be delivered in Month Y. They look at the prices reigning at the moment and come to an agreement. Contracts are exchanged. And if in Month Y the seller is unable to supply the cocoa (in Ghana’s case, because galamsey operations have lessened the harvest and made exportable cocoa beans rather scarce) the COCOBOD can be sued for breach of contract!

And so, Ghana may have to BUY cocoa from its COMPETITORS to fulfill its trade obligations. Indeed, we heard, some months ago, that Ghana COCOBOD had approved a request by some local chocolate manufacturers to buy cocoa from the Ivory Coast for their factories! Amazing isn’t it?

I am afraid we have to be very careful because we live with people who can kill or badly pollute rivers and streams by driving excavators and bulldozers into them; people who are fully aware that Ghana obtains a whopping proportion of its foreign exchange from cocoa, and yet do not scruple to cut down cocoa trees and vandalise the land on which cocoa trees grow, turning cocoa farms, and food farms for good measure, into wasteland, cratered with evil-smelling, algae-filled open pools.

God help Ghana’s food and cocoa producers if the existence of a local gold refinery creates such an ESCALATION in the demand for gold that the galamseyers regard the times as the arrival of THEIR ‘COCOA SEASON’ and they redouble or even re-quadruple their operations.

To fully appreciate the points made in this article, please GOOGLE: GALAMSEY AND DESTRUCTION OF COCOA FARMS.

By CAMERON DUODU

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