PRESENTATION AT THE 15TH INDIA INTERNATIONAL GOLD CONVENTION HELD AT LE MERIDIEN, KOCHI, INDIA ON 3RD AUGUST, 2018 REGULATORY CHANGES, REVENUE REPORTING AND DEVELOPMENTS IN GHANAIAN GOLD MINING SECTOR (JOSEPH YAW ABOAGYE) DIRECTOR, POLICY PLANNING MONITORING & EVALUATION MINERALS COMMISSION, GHANA

TABLE OF CONTENTS 1.0 Introduction 2.0 Policy & Legal Framework Governing Mining 3.0 Categories of Gold Exporters 4.0 Current Gold Export Processes 5.0 Challenges and Measures 6.0 Conclusion

1.0 INTRODUCTION For the past 25 years Ghana has attracted significant mining sector investment amounting to US$19 billion. Currently Ghana has 14 large-scale operating mines; i.e. 12 gold mines, 1 bauxite mine and 1 manganese mine. In 2017, Ghana produced 4,231,376 ounces of gold. This resulted in export revenues of some US$5.7 billion. Significantly small scale miners contributed 34% (1.42 million ounces) of total gold production in 2017. Total Foreign Direct Investment (FDI) into the minerals and mining sector in 2017 amounted to some US$1 billion. In 2017, the mining sector contributed 16.30% to government revenue in the form of domestic tax as reported by the Ghana Revenue Authority. The sector also employed 23,772 people in large-scale mining sub-sector whilst an estimated 1,000,000 people are generally engaged in artisanal and small-scale gold, diamonds and industrial minerals sub sector.

2.0 POLICY & LEGAL FRAMEWORK The various Laws and Policy governing mining operations in Ghana are as follows: Constitution of the Republic of Ghana – Art. 257(6); Art. 269 Act 450 – Minerals Commission’s Act, 1993 Act 703 – Minerals and Mining Act, 2006 Act 900 - Minerals and Mining (Amended) Act, 2016 Minerals and Mining Policy of Ghana, 2014 Other Legislations L.I. 2173 - Minerals and Mining (General) Regulations, 2012 L.I. 2174 - Minerals and Mining (Support Services) Regulations, 2012 L.I. 2175 - Minerals and Mining (Compensation) Regulations, 2012 L.I. 2176 - Minerals and Mining (Licensing) Regulations, 2012 L.I. 2177 - Minerals and Mining (Explosives) Regulations, 2012 L.I. 2182 - Minerals and Mining (Health, Safety and Tech.) Reg. 2012 THE MINERALS AND MINING ACT, THE SUBSIDIARY LEGISLATIONS AND THE POLICIES ARE ADMINISTERED BY THE COMMISSION

3.0 CATEGORIES OF GOLD EXPORTERS Basically, there are two categories of gold exporters in Ghana All are licensed by Government of Ghana (represented by the Hon. Minister, Lands and Natural Resources) on recommendations of the Minerals Commission. CAT. 1: Holders of Mining Lease  Reg. 3, L.I. 2173 Export gold produced from their mining operations Currently, 12 mining lease holders have this permit CAT. 2: Persons other than Mining Lease Holders  Reg. 4, L.I. 2173 Buy gold from small-scale miners and export Process tailings from small-scale mining operations; recover gold and export Process spent carbon and mill liners from large-scale mining operations, recover gold and export Currently, 35 companies have this licence

4.0 CURRENT GOLD EXPORT PROCESSES Prior to export of gold from Ghana, a gold exporter goes through the following protocols: Completion of Bank of Ghana’s Letter of Commitment (LOC) Exporter will download the LOC from the GCNet Portal Exporter provides information on quantity and value of gold to be exported, destination of the gold, details of the importer, method of payment and the name and particulars of the bank which receives the export proceeds. Completed LOC is endorsed by GRA Customs Division Office at Kotoka International Airport (KIA).   Assaying of Gold by Government Reference Laboratory PMMC was appointed Government Assayer on 27th October 2016 in line with Reg. 3(3) of LI 2173 Appointment effectively ended the gold buying and exporting activities of PMMC. Also ended PMMCs ability to appoint Gold Buying Agents Gold Exporter sends the gold to be exported to the Reference Laboratory operated by PMMC for confirmation of quantity and value Examination and Sealing of Gold Bullion Gold Exporter completes Customs Declaration Form Gold is examined and sealed with Customs’ Seal and Reference Laboratory’s Seals Gold is released for export after completion of the assay, examination and documentation which includes Assay Report, Airway Bill (AWB), CEPS Declaration Form, Proforma Invoice and a Parking List.

5.0 CHALLENGES AND MEASURES Smuggling of gold Appointment of Government Reference Laboratory to assay all gold exports MCAS/Customs Verification Portal Letter of Commitment (LOC) Introduction Courier Services Cautioning Under-declaration of gold to be exported Appointment of Government Reference Lab. Non-repatriation of proceeds from gold exports Introduction of LOC to ensure that all export proceeds are returned to the nominated bank. Loss of revenue to the economy (a) Introduction of LOC (b) Support of Giz/Revenue Development Foundation of Norway in establishing: MCAS system to improve mineral titles administration and also track revenues Customs Verification Portal to strengthen the control and mechanism of exporting gold; reduces revenue leakage caused by illicit trade of gold and contributes to sustainable and effective devp’t.

6.0 CONCLUSIONS Responsible Mining is not just about eliminating and minimizing negative impacts, it is about maximizing the positive impacts, and maximizing the value to society throughout the minerals cycle For this reason, Government of Ghana has put in place a number of interventions to eliminate illicit gold trade i.e. smuggling, undervaluation, non-repatriation of proceeds, duping of unsuspected investors. Ghana Government has put in place measures that will generate revenue (i.e. SSM Sustainability Fee) to manage and sustain the small-scale mining sector which provides the feed for local and international gold refineries Ghana Government will continue to work at improving the gold mining sector by working with all other stakeholders including development partners to achieve sustainable development.