In revising its mining code, which currently offers foreign mining companies favorable tax and royalty conditions, leaving the state with limited involvement, Ghana is following in the footsteps of other African countries, AFP reported.
They seek to tighten control over natural resources as global demand for gold and critical minerals such as cobalt soars.
Among those that have recently introduced new mining laws are the Democratic Republic of the Congo, Mali and Tanzania.
Gold prices have soared recently, jumping more than 65 percent in 2025, hitting new records above $5,100 on Monday.
“What we have had since 2014 is a policy that has not been reviewed,” Isaac Andrews Tandoh, acting director-general of the Minerals Commission, told AFP.
“We had to do something to close this gap.”
In Ghana, the world’s sixth largest gold producer, gold production is largely dominated by foreign companies such as the US-based Newmont, South Africa’s Gold Fields and AngloGold Ashanti, and Australia’s Perseus Mining.
Under proposed reforms expected to be presented to parliament in March, mining royalties would jump from the current range of three to five percent to between nine and 12 percent, depending on global gold prices, Tandoh said.
Ghana’s mining deals typically freeze fiscal terms for between five and 15 years in exchange for investments that can exceed $500 million to build or expand mines.
But regulators say some companies are reneging on their commitments.
“We have seen companies with development agreements refuse to develop the mine and instead use the proceeds from Ghana to acquire assets elsewhere,” Tandoh said.
The reforms would eliminate development agreements entirely and revise stability clauses that protect investors from future policy changes, a move that officials say reflects Ghana’s growing experience in managing the sector.
‘Double edge knife’
As African governments increasingly seek a larger share of mining revenues amid rising commodity prices, officials recognize the challenge of balancing investor confidence with national benefit.
Mining policy strategist Eng Wisdom Gomashie said Ghana currently captures only about 10 percent of the total value of minerals through royalties, dividends and taxes.
“The government’s way of thinking is correct,” Gomashie said. “But the approach should not be draconian.”
He warned that stability agreements, although open to reform, are crucial to protecting long-term investments and ensuring external financing, particularly in countries perceived as politically risky.
“Eliminating them completely while increasing royalties could be a double-edged sword,” Gomashie said.
Industry groups have also expressed concern.
Ghana Chamber of Mines chief executive Kenneth Ashigbey said miners were not opposed to the state seeking higher returns, but warned that current proposals risk undermining competitiveness.
“What we are advocating is a sweet spot, a point where the government guarantees sustainable revenues while the industry can expand, reinvest and take advantage of high gold prices,” Ashigbey told AFP.
Large-scale mining companies in Ghana already face a high tax burden, including a five percent royalty on gross receipts and a 35 percent corporate income tax, the chamber said.
In addition to tax reforms, Ghana has tightened regulations on gold trading, particularly in the small-scale sector, to curb smuggling and improve transparency.
Ghana Gold Board spokesperson Prince Minkah said the new licensing and tracking systems have helped formalize trade and increase foreign exchange earnings.
“We now have the data to know when, where and how traders operate,” Minkah told AFP.
Ghana recorded about $10.5 billion in gold export earnings last year.
The country’s proposed mining reforms come as the country faces growing fiscal pressure.
It ended 2025 as Africa’s fourth-largest debtor to the IMF, with $4.1 billion outstanding, and recently received another $365 million under a bailout program.
Public debt stood at 684.6 billion cedis ($55.1 billion) in September, intensifying pressure for domestic revenue and economic stabilization.