Beyond Mineral Extraction: Rethinking Government Support For Sustainable Small-Scale And Large-Scale Mining In Ghana

Asum Obed is the Research Administrator of West Africa Cooperatives Networks

Introduction
Ghana's mining industry remains one of the important pillars of the country's economy, contributing to foreign exchange earnings, employment generation, government revenue and the development of supporting industries. With its considerable deposits of gold and other mineral resources, the country has enormous opportunities to transform its mineral wealth into sustainable economic development. However, an important question remains: how much of the wealth generated from mineral extraction is translating into meaningful economic opportunities for ordinary Ghanaians?

For many years, discussions surrounding Ghana's mining industry have concentrated largely on mineral production, foreign investment, royalties, illegal mining and environmental degradation. Although these issues deserve attention, the national conversation must expand to include indigenous ownership, local industrial development, technology transfer and the ability of Ghanaian businesses to participate meaningfully in the mining value chain.

Small-scale and large-scale mining contribute differently to the country's mineral economy. Large-scale mining companies bring substantial capital, advanced technology, technical expertise and employment opportunities. Small-scale mining, on the other hand, provides livelihoods for many Ghanaians and creates opportunities for indigenous participation in mineral extraction. Both sectors are therefore important and require policies that address their respective challenges.

While small-scale miners struggle with access to affordable financing, modern equipment, geological information and suitable mining concessions, large-scale mining companies require a predictable investment environment, reliable infrastructure, skilled labour and efficient regulatory processes. More importantly, Ghanaian-owned businesses must be given the opportunity to move beyond supplying basic materials and develop the capacity to provide specialised mining services, equipment, engineering solutions and mineral processing.

The 1992 Constitution, the Minerals and Mining Act, 2006 (Act 703), and the Ghana Gold Board Act, 2025 (Act 1140), provide important foundations for governing the country's mineral resources. However, the effectiveness of these laws should be measured not only by their ability to regulate extraction but also by their contribution to national economic development.

Ghana must therefore move beyond treating mining primarily as an extractive activity and begin building an industry that creates sustainable opportunities for its people.

Mineral ownership and the responsibility of government

Article 257(6) of the 1992 Constitution provides that minerals in their natural state are the property of the Republic and vested in the President on behalf of, and in trust for, the people of Ghana. Article 268 further provides for parliamentary ratification of agreements involving the exploitation of mineral resources, while Article 269 establishes the constitutional basis for regulatory institutions responsible for managing natural resources.

These provisions establish an important principle: Ghana's mineral resources are a national asset held for the benefit of its people. Consequently, government must ensure that mineral development produces benefits beyond royalties, taxes and foreign exchange earnings.

This responsibility should include creating opportunities for indigenous businesses, improving employment prospects, supporting mining communities and strengthening domestic industries. Attracting foreign investment remains important, but it should go hand in hand with developing Ghanaian enterprises capable of participating competitively in the industry.

Reforming the Minerals and Mining Act, 2006 (Act 703)

The Minerals and Mining Act, 2006 (Act 703), as amended, remains the principal legislation regulating mineral rights and mining operations in Ghana. However, the evolving needs of the industry make it necessary to examine how the legislation can better support indigenous participation and sustainable mining development.

One important provision is Section 105, which requires holders of mineral rights to give preference to Ghanaian products, local service agencies and the employment of Ghanaian citizens, subject to safety, efficiency and economic considerations. This provision, together with the Minerals and Mining (Local Content and Local Participation) Regulations, 2020 (L.I. 2431), provides a foundation for strengthening local participation.

Nevertheless, local content must go beyond employing Ghanaians. It must deliberately support the growth of Ghanaian-owned companies capable of competing for substantial mining contracts. Government should therefore consider strengthening Section 105 and the implementation of L.I. 2431 to introduce measurable supplier-development targets, transparent procurement reporting and structured opportunities for qualified indigenous contractors.

The Minerals Commission should publish annual reports showing the proportion of mining procurement awarded to genuinely Ghanaian-owned enterprises, the value of contracts retained within the country and progress made in developing local suppliers. Mining companies should also be encouraged to establish technical and financial development programmes for indigenous contractors.

Additionally, Sections 81–99, which provide the framework for small-scale mining, should be strengthened to make legal mining more accessible and economically viable. Government must improve access to suitable concessions, geological information, modern equipment and technical training. Licensed mining cooperatives should also be encouraged to acquire shared equipment and access professional services.

The objective should not simply be to formalise small-scale mining but to develop a productive, commercially viable and environmentally responsible sector.

Ghana Gold Board: Turning gold marketing into mining development

The enactment of the Ghana Gold Board Act, 2025 (Act 1140), introduced an important opportunity to strengthen the gold value chain, promote value addition and support responsible small-scale mining.

Section 3 of the Act provides for GoldBod to collaborate with the Ministry responsible for Mines in supporting small-scale miners through geological investigations, concession viability assessments and equipment financing. More importantly, Section 25 requires the Board to earmark not more than 30 per cent of its preceding year's surplus funds to support small-scale miners.

The funds may support concessional financing, environmentally sustainable equipment, technical training, research and the establishment of gold processing and refining facilities.

This provision presents an opportunity that government must translate into measurable results. However, the existing law provides for an allocation of up to 30 per cent rather than guaranteeing a minimum annual allocation.

Government should consider amending Section 25 to establish a predictable minimum allocation from audited surplus funds, subject to the Board's financial sustainability and appropriate parliamentary oversight. Clear eligibility criteria, independent audits and public reporting should accompany the funding arrangement.

GoldBod should also collaborate with financial institutions and equipment manufacturers to establish an equipment leasing scheme for licensed small-scale miners. This would allow eligible operators to acquire modern processing equipment and repay the cost over an agreed period instead of bearing the full purchase cost upfront.

Furthermore, the Board's value-addition mandate should be used to encourage local gold refining, jewellery manufacturing and other gold-related industries. Ghana must seek to retain more economic value from its gold resources rather than concentrating exclusively on mineral extraction and exports.

Empowering Ghanaian mining contractors and local industries

One of the greatest opportunities for Ghana's mining industry is the development of indigenous mining contractors.

Mining operations require drilling, excavation, haulage, equipment maintenance, engineering consultancy, mineral processing, transportation and several other specialised services. Ghanaian businesses should be positioned to provide an increasing proportion of these services.

Government should therefore establish an Indigenous Mining Contractor Development Programme that facilitates affordable financing, equipment acquisition, technical certification and partnerships between local enterprises and experienced international companies.

A dedicated financing facility could be developed through government-supported credit guarantees, participating financial institutions and private-sector partnerships. Such a programme should support

qualified Ghanaian contractors based on technical competence, commercial viability and genuine local ownership.

The Minerals Commission should also work with mining companies to identify contracts that can be progressively undertaken by capable indigenous businesses. This would strengthen local participation while maintaining the safety, quality and operational standards required by the industry.

The ultimate objective should be to develop Ghanaian companies that can eventually compete beyond the domestic mining market.

Mining communities and environmental sustainability

The development of Ghana's mining industry must also reflect the interests of communities that host mining operations.

The Minerals Development Fund Act, 2016 (Act 912), establishes a framework for directing mineral-related revenues towards mining communities and institutions responsible for development. However, government must strengthen transparency in the allocation and utilisation of these resources.

Communities should have access to information on mineral revenues allocated to their districts and the projects financed through those allocations. Annual public reports, community participation in development planning and independent project monitoring would improve accountability.

The Environmental Protection Act, 2025 (Act 1124), also provides an important framework for environmental protection, including the management of mining-related environmental issues and reclamation financial security.

Government must ensure that environmental obligations are effectively enforced while supporting licensed small-scale miners to adopt responsible mining technologies. Large-scale mining companies must equally comply with environmental standards and their rehabilitation obligations.

Mining development should not leave communities with polluted water bodies, degraded agricultural land and abandoned mining pits. Economic growth must be accompanied by environmental responsibility.

A practical way forward

To translate these reforms into tangible outcomes, government should prioritise five interventions.

First, Parliament should strengthen the ongoing reform of Act 703 by incorporating enforceable provisions for indigenous contractor development, local procurement, accessible small-scale mining support and community development.

Second, GoldBod should operationalise a transparent financing and equipment support programme for licensed small-scale miners, with measurable performance targets.

Third, government should facilitate an Indigenous Mining Development Fund to support Ghanaian mining contractors, equipment suppliers, manufacturers and mineral processing enterprises.

Fourth, universities, particularly the University of Mines and Technology (UMaT), should be supported to collaborate with mining companies and indigenous businesses in developing locally appropriate mining

technologies. Research in mineral processing, mine planning, equipment maintenance, artificial intelligence and environmental rehabilitation should receive greater attention.

Finally, the Minerals Commission, the Environmental Protection Authority and the Minerals Development Fund should strengthen monitoring, reporting and accountability to ensure that mining operations contribute meaningfully to national and community development.

These interventions should be implemented through coordinated action involving the Ministry of Lands and Natural Resources, Parliament, financial institutions, mining companies, traditional authorities and technical institutions.

Conclusion

Ghana's mineral wealth presents an enormous opportunity for national economic transformation. However, the success of the mining industry should not be measured solely by the volume of gold extracted, the number of operating mines or the foreign exchange generated. It should also be measured by the Ghanaian businesses developed, the technical expertise transferred, the industries established and the communities transformed.

The constitutional and legislative framework already provides an important foundation for responsible mineral development. What is required is stronger implementation and targeted reforms that make indigenous participation, local value addition and sustainable development central priorities.

Government must create an environment where small-scale miners can access financing and modern equipment, large-scale mining companies can operate within a predictable regulatory environment, and Ghanaian contractors can compete for meaningful opportunities across the mining value chain.

Ultimately, Ghana must move beyond exporting mineral wealth towards developing the industries, businesses and technical capabilities that generate lasting economic value.

Our mineral resources should not only generate revenue for the country; they should build businesses for our people, create opportunities for our youth, strengthen our industries and improve the lives of communities that host mining operations.

Ghana must not simply be a country where minerals are extracted. It must become a country where mineral wealth is transformed into national prosperity.

By Asum Obed
Research Administrator for West Africa Cooperatives Networks