To further deepen the foreign exchange market, in 2017, the mining sector, through commercial banks and the Central Bank, returned a total of US$ 2.57 billion of the US$ 3.68 billion mineral revenue into the country.
This represented 70 percent of total mineral revenue in 2017. These facts were contained in the 2017 annual report of the Ghana Chamber of Mines.
Under the amended mandatory surrender requirements, the Bank of Ghana directed that mining companies and other export revenue earners cede the equivalent share of their foreign exchange revenue to commercial banks.
This notwithstanding, it is noted that the BoG continues to be a conduit for ploughing back mineral export proceeds into the country due to some challenges in implementing the policy directive.
The plough back of mineral exports receipts and expenditure are critical pathways by which mining influences the growth of the non-mineral economy and national development.
In the same year, US$ 368.164 million of the returned mineral revenue of US$ 2.57 billion was brought back into the country through the BoG.
This translates into 22 percent of mineral revenue. The remaining US$ 2.20 billion was returned into the country through the commercial banks.
The total expenditure of the producing member companies of the Chamber on goods and services procured from in-country suppliers and manufacturers stood at US$ 1.23 billion in 2017, representing 34 percent outturn in 2016.
Further to this, the proportion of the producing mines’ expenditure of mineral revenue on imported consumables declined from seven percent in 2016 to 6 percent in 2017.
The 2017 share of expenditure translates into US$ 215.6 million.
Therefore, in the last few years, the mining sector pattern of expenditure consistently show year on year increases in demand for locally sourced inputs and steady decline in spending on imported consumables.
Moreover, the mining companies’ statutory payments to the central government totalled US$ 400.4 million in 2017 while compensation payments to employees were US$515.1 million in the same period.
These represent 11 percent and 14 percent of realised mineral revenue respectively.
By Joshua W. Amlanu