DEVELOPING MESSAGES FOR THE UN CONFERENCE DEVELOPING MESSAGES FOR THE UN CONFERENCE ON SUSTAINABLE DEVELOPMENT REVIEW – ON SUSTAINABLE DEVELOPMENT REVIEW –

DEVELOPING COUNTRY PERSPECTIVEDEVELOPING COUNTRY PERSPECTIVE

MINING AND SUSTAINABLE MINING AND SUSTAINABLE DEVELOPMENT IN GHANADEVELOPMENT IN GHANA

PRESENTED BY PRESENTED BY

Messrs. BEN ARYEE & JOSEPH Y. ABOAGYEMessrs. BEN ARYEE & JOSEPH Y. ABOAGYE

DATE: SAT. MARCH 1, 2008DATE: SAT. MARCH 1, 2008

PRESENTATION OUTLINEPRESENTATION OUTLINE IntroductionIntroduction Governments Role Governments Role

– The Policy and Regulatory FrameworkThe Policy and Regulatory Framework– Basic Geo-scientific Data AvailabilityBasic Geo-scientific Data Availability– The Legal Framework/RegimeThe Legal Framework/Regime

The Operating EnvironmentThe Operating Environment– Maximization of local content in the mining Maximization of local content in the mining

sectorsector– Mitigating the negative impactsMitigating the negative impacts– Stakeholder ParticipationStakeholder Participation– Corporate Social ResponsibilityCorporate Social Responsibility– International CooperationInternational Cooperation

Contribution of Mining to Ghana’s EconomyContribution of Mining to Ghana’s Economy ConclusionConclusion

INTRODUCTIONINTRODUCTION It is noted that mining necessarily ends up depleting It is noted that mining necessarily ends up depleting

the resource it uses and is characterized by some the resource it uses and is characterized by some negative impactsnegative impacts

However, it has significant potential for making However, it has significant potential for making positive impacts, as acknowledged in chapter 46 of positive impacts, as acknowledged in chapter 46 of the Johannesburg Plan of Implementation of the the Johannesburg Plan of Implementation of the WSSD. WSSD.

INTRODUCTIONINTRODUCTION

As it was especially noted, it is possible for mining As it was especially noted, it is possible for mining to contribute to sustainable development through:to contribute to sustainable development through:

(1) enhancing the benefits while mitigating the negative (1) enhancing the benefits while mitigating the negative impacts both when mining is taking place and impacts both when mining is taking place and subsequently as well assubsequently as well as

(2) improving stakeholder participation in the (2) improving stakeholder participation in the management of the resources. management of the resources.

INTRODUCTIONINTRODUCTION

In this context, this presentation reviews In this context, this presentation reviews

Measures aimed at ensuring and Measures aimed at ensuring and

the extent of the contribution of mining in Ghana the extent of the contribution of mining in Ghana to Sustainable Development in line with the to Sustainable Development in line with the Brundtland Commission definition of such Brundtland Commission definition of such development as;development as;

– ““Development that meets the needs of the Development that meets the needs of the present without compromising the ability of present without compromising the ability of future generations to meet their own needs.” future generations to meet their own needs.”

Government’s RoleGovernment’s Role

Governments are put in place to ensure, or at least Governments are put in place to ensure, or at least facilitate, facilitate,

the socio-economic development of the people the socio-economic development of the people within its jurisdiction through the use of the within its jurisdiction through the use of the resources available to it, especially those in which resources available to it, especially those in which comparative advantage exists or can be comparative advantage exists or can be developed.developed.

In this respect the interventions Government has In this respect the interventions Government has been pursuing towards Sustainable Development been pursuing towards Sustainable Development through mining include:through mining include:

The Policy and Regulatory FrameworkThe Policy and Regulatory Framework– Mining Policy which has sustainable development as its Mining Policy which has sustainable development as its

guiding principleguiding principle

Basic Geo-scientific Data AvailabilityBasic Geo-scientific Data Availability– Currently, enormous geo-scientific data gathering – both in Currently, enormous geo-scientific data gathering – both in

the form of airborne geophysical surveys and ground the form of airborne geophysical surveys and ground studies - is being undertaken in the country under a EU studies - is being undertaken in the country under a EU supported Mining Sector Support Programme. supported Mining Sector Support Programme.

The Legal Framework/RegimeThe Legal Framework/Regime– A fair, stable regime based on Good Governance (Act 703)A fair, stable regime based on Good Governance (Act 703)– Regime that ensures reasonable revenue to GovernmentRegime that ensures reasonable revenue to Government– Regime that demands environmental protection & Regime that demands environmental protection &

RemediationRemediation– Regime that recognizes environmental protection and Regime that recognizes environmental protection and

remediationremediation– Regime demanding integration with local economyRegime demanding integration with local economy

Government’s RoleGovernment’s Role

THE OPERATING ENVIRONMENT/REGIMETHE OPERATING ENVIRONMENT/REGIME

Mining uses up the resources which promoted it, thus it must Mining uses up the resources which promoted it, thus it must

catalyze the development of other economic activities and alsocatalyze the development of other economic activities and also

generate enough positive impacts to assist in sustainable generate enough positive impacts to assist in sustainable

development.development.

Developments observed in Ghana’s Mining Sector include:Developments observed in Ghana’s Mining Sector include: Maximization of local content Maximization of local content

– Human Resource Development (HRD)Human Resource Development (HRD) Significant increase in number of locals in senior managementSignificant increase in number of locals in senior management

– Other Local ResourceOther Local Resource Significant increase in the number of Mine Support Service Significant increase in the number of Mine Support Service

Companies, from 70 in year 2000 to 130 in 2007.Companies, from 70 in year 2000 to 130 in 2007. Local companies provide; assay, exploration, contract mining Local companies provide; assay, exploration, contract mining

etc to mining companiesetc to mining companies Ghanaian owned companies account for some 30% of theGhanaian owned companies account for some 30% of the total total

Mitigating the Negative ImpactsMitigating the Negative Impacts– Environmental Permits made requirement for the Environmental Permits made requirement for the

acquisition of mineral rightsacquisition of mineral rights

Stakeholder ParticipationStakeholder Participation– Publication of applications at the district and local levelsPublication of applications at the district and local levels– Public hearingsPublic hearings

Corporate Social ResponsibilityCorporate Social Responsibility

– Mining companies assist local communities within close Mining companies assist local communities within close proximity of their operations through the establishment proximity of their operations through the establishment of fund or foundation for community developmentof fund or foundation for community development

– This fund is financed by a stated amount for every ounce This fund is financed by a stated amount for every ounce of gold mined and/or a stated amount proportion of of gold mined and/or a stated amount proportion of pretax profitspretax profits

THE OPERATING ENVIRONMENT/REGIMETHE OPERATING ENVIRONMENT/REGIME

THE OPERATING ENVIRONMENT/REGIMETHE OPERATING ENVIRONMENT/REGIMEInternational CooperationInternational CooperationGovernments subscription to the EITIGovernments subscription to the EITI

– increase transparency in the receipt and utilization of increase transparency in the receipt and utilization of payments and revenues generated by extractive payments and revenues generated by extractive industries. industries.

– Ghana has gone beyond the requirements of EITI to further Ghana has gone beyond the requirements of EITI to further incorporate transparency in the use of such receipts at the incorporate transparency in the use of such receipts at the local communities through the MDFlocal communities through the MDF

Ghana has also associated itself with internationalGhana has also associated itself with international

organizations, like the African Mining Partnershiporganizations, like the African Mining Partnership

and the Intergovernmental Forum on Mining andand the Intergovernmental Forum on Mining and

Metals, with focus on sustainable developmentMetals, with focus on sustainable development

through mining. through mining.

Contribution of Mining to Ghana’s Contribution of Mining to Ghana’s EconomyEconomy Political StabilityPolitical Stability

Economic ContributionsEconomic Contributions– 5% GDP;5% GDP;– 12% of Government Revenue;12% of Government Revenue;– 7% of Ghana’s total corporate tax; and7% of Ghana’s total corporate tax; and– 41% of total export earnings41% of total export earnings– Export earnings from the mineral sector in 2007 Export earnings from the mineral sector in 2007

amounted to US$2.5 billionamounted to US$2.5 billion

Employment GenerationEmployment Generation– Large scale mining sector employs 20,000 people;Large scale mining sector employs 20,000 people;– While over 500,000 people are engaged in smaller While over 500,000 people are engaged in smaller

scale operations; andscale operations; and– Mine Support Service Companies employ 4,000 peopleMine Support Service Companies employ 4,000 people–

ConclusionConclusion These modest contributions have in no small way supported These modest contributions have in no small way supported

the development of other sectors of the economy of Ghana the development of other sectors of the economy of Ghana and are expected to be the foundation for broader-based and are expected to be the foundation for broader-based sustainable development.sustainable development.

Opportunity exists to deepen the geoscientific knowledge base as Opportunity exists to deepen the geoscientific knowledge base as a means of optimizing the exploitation and utilization of the a means of optimizing the exploitation and utilization of the country’s mineral resources while enhancing the capacity of country’s mineral resources while enhancing the capacity of regulatory agencies for the purpose.regulatory agencies for the purpose.

While assistance, both bilateral and multilateral, would be While assistance, both bilateral and multilateral, would be welcomed in these respects, Government will continue to welcomed in these respects, Government will continue to work at improving its facilitation role while working with all work at improving its facilitation role while working with all other stakeholders towards achieving sustainable other stakeholders towards achieving sustainable development through mining. development through mining.