Third World Network wants disclosure on govt, Goldfields deal
Third World Network (TWN), a policy think tank, is challenging the government to give a full disclosure of an agreement it signed with Goldfields Ghana Limited which gives the company a reduction in corporate tax rate from 35.0 per cent to 32.5 per cent effective March 17, 2016.
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It also called on Parliament to explain why it adopted an unconstitutional process when it granted a 48-hour waiver to amend the law for the ‘government-Goldfields deal’, saying the move was arbitrary and capricious.
Dr Yao Graham, Co-odinator of TWN, at a press conference in Accra last Monday, said the move by the government and Parliament was an illegality which needed not to be condoned.
Under the agreement, Goldfields Ghana Limited is to pay lower royalty as compared to other mining companies from a flat five per cent of revenue to a sliding scale royalty based on the gold price from January 1, 2017.
Royalty rates
The sliding scale royalty rate means Goldfields will pay a royalty of three per cent when gold prices fall below $1,300 per ounce.
Similarly, the company will pay 3.5 per cent when prices are between $1,300 and $1,449.99/oz, pay 4.0 per cent when prices are between $1,450 and $2,299.99/oz and 5.0 per cent when prices go beyond $2,300/oz.
According to Dr Graham, the government was yet to make the deal public to Ghanaians since Goldfields announced it at the Johannesburg Stock Market on March 29, 2016.
“Johannesburg, March 29, 2016: Goldfields Limited (Gold Fields) (JSE, NYSE: GFI) is pleased to announce that it has concluded a development agreement with the Government of Ghana for both the Tarkwa and Damang mines,” the Goldfield announcement said.
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He said the deal, which Goldfields, in its statement on the Johannesburg Stock Market, termed as a development agreement, could not be so as under the Minerals and Mining Act, Act 703, the company did not qualify for such an agreement.
Company in distress
Explaining further, Dr Graham said the Chief Executive Officer of the Minerals Commission, Dr Toni Aubynn, who is the only official to have come out and given some scanty information on the deal, said the Damang Mine of Goldfields was in distress.