Finance Minister justifies 'controversial' Agyapa Royalties agreement

Ghana's Minister of Finance, Ken Ofori-Atta, has justified the Agyapa Royalties agreement, inspite of the surrounding 'controversies'.

Ken Ofori-Atta at a press conference on Thursday, dismissed claims that the Akufu-Addo led government established Agyapa Gold Mineral Royalty Limited to mortgage the country’s ‘future resources’ to enrich the current administration.

Mr Ofori-Atta was emphatic that “there are those who say we should be careful not to mortgage or sell today, the gold in the ground for future generations” but “this is not the case”.

He says the Agyapa Royalties agreement provides government with the opportunity to use innovative ways to manage and maximize the country’s mineral wealth.

According to him, the current arrangement where the value multinational companies in Ghana’s extractive industry are assessed by basic indicators such as taxes rather “ignores many of the different ways in which the countries that extract the resources utilise their rights beyond and outside of our borders as a means of creating value.”

READ ALSO:
You don’t have to visit me only when you are in power – Otomfuo to NDC

The flagbearer of the National Democratic Congress (NDC), John Dramani Mahama, had during his campaign tour in the Volta Region, alleged that cronies of President Akufo-Addo were seeking to cut dubious deals by buying off 49% shares, in the public listed company which government intends to use as a Special Purpose Vehicle (SPV) to raise funds for developmental projects.

Officials of the Minerals Investment Fund (MIIF) had earlier explained that Agyapa Royalties Limited, which has been incorporated in Jersey will be listed on both the Ghana and London Stock Exchange

Civil Society groups in Mines and Energy have subsequently described the SPV as one which is not transparent and must be suspended.

They also raised questions as to why the company was established in a known tax haven.

At the media engagement, however, the Minister for Finance, Ken Ofori-Atta, maintained that the Agyapa Royalty transaction is wholly in the best interest of the country.

“There are those who say we should be careful not to mortgage ourselves today, the gold for our future generations. This is not the case. But I have a few questions for people who have those concerns. If it is okay for foreign investors to hold concessions to sell what is on the ground up front then why not us? More importantly, why is it okay to borrow today for the future and not good to use our resources to leverage assets for tomorrow? We must be creative in our quest to raise revenue to support our development by giving direct access to our resources in a manner that is open and transparent and operates within laws that exist outside our country. It is time to re-imagine our future. We all must be tired of being cheated by foreign companies and we restraining ourselves with this same vehicle they use. We have to maximize the value of income that is due the republic… That is the prime objective of the MIIF,” he said.

The Minister also said, there was a need for government to create value for the country’s mineral resources, especially by leveraging that value to investors who do not want to invest directly in the country but want access to more resources so government would have access to capital in a bid to accelerate Ghana’s development and economic diversification.