AngloGold Ashanti Digs Africa A Big Economic Hole: De ja vu!

The mismanagement of African capital by non-patriotic white managers in South African companies continues unabated. The state-owned Public Investment Corporation (PIC) has been a major shareholder in companies like SAB, Naspers and AngloGold Ashanti Limited, all of which chose to leave our shores and take billions of US dollars with them. Despite its power, the PIC is a lame duck in the pervasive neo-colonialist idea of economic punishment and permanently crippling South Africa and the continent.

The latest saga involves AngloGold Ashanti, a company built on the sweat of black workers in both Ghana and South Africa, which has also decided to join a long queue of companies leaving the continent for overseas. The company’s shareholders voted for the migration of its primary listing from Johannesburg to New York and headquarters to London. This story has become familiar, but this time Ghana is sadly impacted by the attitudes of white capital.

The common denominator in these capital-related shenanigans is none other than Maria Ramos. She replaced Sipho Pityana as chairperson of AngloGold Ashanti, the eye of a storm. Perhaps the questions that must be asked are: What role is she playing in AngloGold Ashanti’s decision to relocate its headquarters from Africa?

Additionally, how far is Ramos willing to lead AngloGold Ashanti in shifting its majority shareholding base from Africa to the West, even as the company’s value creation remains in Africa? This mirrors how both Anglo-American and SAB set sail to distant shores and never returned. The truth is, they left rubble behind: broken black workers, derelict mines, a polluted environment and a culture of drunkenness.

In 2021, Mail & Guardian reported that Pityana and Ramos had different opinions regarding AngloGold Ashanti's primary listing. Pityana opposed the relocation of the listing abroad, while Ramos advocated for it. The clash between them allegedly led to a damaging sexual harassment complaint against Pityana, which ultimately blocked his nomination as ABSA board chair. Pityana maintains that Ramos had ‘weaponised’ the allegation to remove him from AngloGold Ashanti and expedite the moving of the company’s primary listing to London.

Now, it appears that Pityana’s claims have been vindicated as the company’s decision to depart Africa has been confirmed. The PIC appears to be complicit in this sophisticated crime aimed at robbing Africans of their livelihood.

Anticipating the dilution of South African shareholding due to the overseas listing, the PIC has only stipulated that at least two South Africans maintain their seats on the company’s board without addressing the representation of Black South Africans and Africans, particularly those from Ghana.

The Economist magazine once wrote: “Few companies are dearer to their home countries than Ashanti Goldfields is to Ghana.”

Established in 1897, Ashanti Goldfields Corporation Limited (AGCL) played a pivotal role in Ghana’s post-colonial economy. In 1969, Ghana’s government, seeking to assert control over the country’s mineral resources, acquired a 20% stake in AGCL from its British parent company, Lonrho. Subsequently, the government enacted legislation to transform AGCL into a Ghanaian-registered entity. It secured a 55% majority shareholding in AGCL, leaving Lonrho with a 45% minority stake.

In 1994, as part of the Economic Recovery Programme, the Ghanaian government sold shares in Ashanti Goldfields, contributing to the company’s restructuring and listing on the London and Ghana stock exchanges. Led by CEO Sam Jonah since 1986, Ashanti became a global gold mining giant through mergers and acquisitions, with listings in Australia, New York, Toronto and Zimbabwe.

The company continued to play a vital role in Ghana’s economy, contributing 28% of foreign exchange earnings in 1994 and remained a significant employer in the Obuasi region. Despite privatisation, the government still held a 19.4% stake in Ashanti’s issued share capital. On the basis of 1996 production levels, the company was the largest producer of gold in Africa outside South Africa.

During this period, Jerry Rawlings’ government blocked a merger with Lonmin, which had a 28% stake in Ashanti. Ashanti was going through a rough patch, and its poor share price performance was blamed on a perception of undue government influence in the company.

Nonetheless, John Kufuor’s administration facilitated the smooth transition from the regime of Jerry Rawlings in January 2001. This was at the height of ‘Africa’s Renaissance’, spearheaded by Thabo Mbeki, where South Africa’s contributions were viewed as “crucial for Africa’s renewal”. Chequered white South African capital grabbed the opportunity to spread its wings to the steppe, spreading its abhorrent racist cultural practices.

Right from the outset, Kufuor declared Ghana open for business and announced a range of economic measures designed to stabilise the economy, including the privatisation of Ashanti. In February 2004, the Ghanaian government held a 16.8% stake in Ashanti Goldfields, while Lonmin owned 27.4%. Private investors held the remaining shares. With political manoeuvring behind the scenes to create one of the largest gold mining companies in the world, AngloGold Ashanti was born.

In April 2004, it was reported that Ashanti Goldfields shareholders had voted overwhelmingly in favour of the group’s merger with South African-owned AngloGold. The merger also had the Kufuor government’s blessings, which was prepared to let the government retain its golden share, unlike Rawlings. Creeping apartheid capital was spreading its wings much wider than the biggest eagle, and that is where the ‘cancelling’ of Ghana from the company’s DNA began.

AngloGold Ashanti Limited became the third-largest gold producer in the world, with operations in Ghana’s Ashanti and Western Region and headquarters in South Africa. In total, the company had 17 mines in nine countries, as well as several exploration programmes in both established and new gold-producing regions of the world.

The merger of Ashanti Goldfields with AngloGold was a landmark deal widely celebrated as a milestone for Africa. The Asantehene, Otumfuo Osei Tutu II, for instance, hailed the merger as “a major step in economic cooperation between South Africa and Ghana”. Today, the Asantehene must be wondering whether the ‘Ashanti brand’ of this iconic gold mine would one day be jettisoned by international capital via a merger or an acquisition. It happened to SAB, now Anheuser-Busch InBev; the Ashanti name is about to meet the same fate.

However, this marriage of convenience, primarily benefiting South Africa, has come at a significant cost for Ghana. Today, Ghanaians have no direct ownership stake in any of the mines operating in their country. The government enjoys a mandatory 10% free carrying in the two AngloGold Ashanti subsidiary mines in Ghana. However, neither private Ghanaians nor the government holds even a single share in the Group that is now listed on the NYSE or the secondary listing in the JSE.

Ghana’s government recently granted Atlantic Lithium (Ewoyaa) a 15-year permit to operate a lithium mine. The Minerals Income Investment Fund, the country’s sovereign wealth fund, will also acquire a 6% stake in Ewoyaa and a 3.06% in Atlantic Lithium, while the state’s interest in the project is a modest 13% and collects a mere 10% of royalties. Ghana appears to have lost its touch as it fails to demand a higher off-take for one of the world’s most critical mineral projects.

Since the state lost Ashanti, Jonah has expressed his regret by stating that “it is a shame because we sold”. The story becomes even more complex as Ghana now has a lone voice on the AngloGold Ashanti board, and the company is planning to move its primary listing from Johannesburg to New York, effectively severing its ties to its African roots.

AngloGold Ashanti’s board of directors, tasked with overseeing the company’s strategic direction, features only three directors of African origin: Ramos and Rhidwaan Gasant, both South African, along with Kojo Busia, a Ghanaian. At the executive suite level, no Africans are represented. This underrepresentation of black Africans within a company once lauded for its exceptionally strong African roots and as an African champion is highly concerning.

Even more worrisome is that the black workers’ money held by the PIC is being exported once more to benefit places outside the continent when the South African economy desperately needs revival and growth. When this phenomenon of capital exodus began around 2000, Sibusiso Ndebele interpreted it to mean “‘whiteness’ delinking itself from the mire of its South African history…”

Now and with all its challenges, Ghana has been dragged into a mix masala of apartheid revivalism in South Africa, where no one cares about the plight of its black majority. Racial animus!

What is frustrating is that not less than 60% of AngloGold Ashanti’s value is derived from Africa. In essence, these South African companies seek disengagement opportunities and are unavoidably transforming their home base into a satellite market orbiting around powerful Western economies. Consequently, South Africa and Africa are currently being reduced to markets “to be exploited rather than a home to be served”.

Ndebele suggested that “this kind of ‘flight of white capital’ could symbolise white people’s abdication of responsibility towards the only history that could offer salvation to ‘whiteness’”.

In summary, AngloGold Ashanti becomes another South African company to depart from South Africa under highly detrimental circumstances, with the approval of the country’s main macroeconomic framework. The 30 years of democracy are rapidly turning into a nightmare for the black majority, and others are affected too. On the other hand, Ghana prescribed itself a bitter economic pill that has left the country with no significant role as a producer of minerals.

Steve Tombs and David Whyte argue that legal and political structures mould corporations in a way that empowers them to cause harm to both people and the environment. Based on this, they also assert that “criminality is part of the DNA of the modern corporation”. Africa has been experiencing this skulduggery for a long time now: illicit financial flows, exploitation, currency manipulation, tax evasion, corruption and violence.

When Absa Group, then under Barclay’s, was found to have participated in the manipulation of the ZAR, Ramos could only say: “We deeply regret that this conduct took place within our organisation…” But will anyone ever say ‘kafra’ (sorry) to Ghanaians and Africans at large for yet another untimely capital exit?

The AngloGold Ashanti exit is proving one more time that Africa is seen as nothing but a scum of the earth and does not deserve any better. It is a case of yet another de ja vu!