The Institute of Economic Affairs (IEA) says the government’s cut in the Growth and Sustainability Levy (GSL), from three to one per cent, risks undermining the efforts to maximise national benefits from the country’s natural resources.
At a press briefing in Accra on Wednesday, the policy Think-Tank said the government’s decision, with the intention of cushioning investors, was a departure from the global development shift, anchored in ownership and greater benefits.
“Why did government increase royalties, ostensibly to capture greater value from Ghana’s mineral wealth, only to simultaneously dilute that gain through tax concessions?” Justice Sophia Akuffo, a Distinguished Fellow of the IEA, said.
She noted that the reduction in the levies weakened the broader objective of ensuring that Ghana derived maximum benefit from its extractive sector, calling for coherent and predictable fiscal policies aligned with long-term national interests.
The former Chief Justice raised concerns that the country has trillions of dollars in natural resources, yet has visited the International Monetary Fund (IMF) 17 times for financial bailouts to avoid imminent economic collapse.
She also cited the Minister of Finance’s recent announcement that the Government would borrow GH¢17 billion to pay salaries as concerning, urging action to leverage the country’s natural and mineral resources to champion the national development agenda.
Justice Akuffo referred to Botswana, Burkina Faso, Chile, and Venezuela, which have embraced a new arrangement anchored in ownership, calling on the government to adopt new terms for resource extraction to ensure long-term benefits for the country.
In Botswana, for example, there was increased State participation in its diamond industry to capture greater value for the people, while Burkina Faso used similar agreements in the management of its natural and mineral resources, the former Chief Justice said.
“These developments have shown that asserting sovereignty does not repel investment; rather, it redefines the terms of engagement in favour of national development,” she said.
“They also show that Africans have woken up, and Ghana must join the awakening.”
“The fact that over 30 mining leases are nearing expiration, the record highs in the global prices of key minerals and the discoveries of new critical minerals, offer Ghana a once-in-a-generation opportunity to reset the country’s mineral resource governance framework.”
That, she indicated, required engaging the private sector, local and foreign expertise strictly through service contracts that preserved national control and maximised benefits for Ghana’s industrial transformation.
DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.
DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.
Source: www.myjoyonline.com