Why should foreigners benefit more from our gold than us? – Ofori-Atta justifies Agyapa Royalties deal

Minister of Finance, Ken Ofori-Atta has assured Ghanaians that the Agyapa Royalties deal is not to forfeit untapped gold resources for present gains.

Mr Ofori-Atta was emphatic that “there are those who say we should be careful not to mortgage or sell today, the gold in the ground for future generations” but “this is not the case”.

The agreement concerning Agyapa Royalties, a Special Purpose Vehicle (SPV) company was approved on August 14, 2020, by parliament in line with the Minerals Income Investment Fund (MIIF) Act, 2018 (Act 978). This is aimed at using the state firm to secure about $1 billion through prudent management of mineral resources.

The critics have cited a lack of information on the shareholders of the firm and the registration of the company in a tax haven at Jersey in the United Kingdom.


The island of Jersey, one of the European tax havens, offers to its residents a 0% corporate tax and low personal income tax rates. In addition to a favourable tax regime, Jersey Island invites investors with a number of other financial benefits, including low social security payments, no stamp duty on equity transactions, and a straightforward method of making tax and social security contributions.

Due to its attractive investment environment, Jersey has become a popular destination for high-net-worth individuals aiming at minimizing their tax liability. Currently, the Island warehouses almost €2 trillion of investors’ wealth.


At a press conference to address controversies, the Finance Minister, Ken Ofori-Atta, said government has a responsibility to maxmise the country’s mineral resources.

“If it is okay for the foreign investors who hold the concession to sell what is in the ground upfront then why not us? More importantly, why is it okay to borrow today for the future and not good to use our resources to leverage assets for tomorrow?”

For him, it was time Ghana became creative in exploring sources of funding to support development.

“Every year and every generation we wait we keep millions of people and families stacked in the poverty and sufferings,” he stressed.

He said in most cases investors who are willing to pay a premium for access to our resources exist beyond our borders and therefore “we need to create structures that allow us access to their funding and if we don’t do that we allow ourselves to remain captives to international companies that take our resources and simply market them to the same groups we choose to ignore”.

He said it was sad that a country like Ghana that has been mining gold since the 5th century would still not have any internationally listed company either in gold or even cocoa and “this must come to an end”.

He cited companies that have been able to create more returns than governments who own the resources used by the companies. He singled out Tullow which he said has raised low-priced bonds in the midst of the current economic crises even at a rate lower than the government of Ghana from whom they receive the mandate to extract resources.

“We all, by now, must be tired of being cheated by foreign companies and we are restraining ourselves from using the same vehicles that they use. We have to maximise value of our income that is due the republic from our mineral wealth for the benefit of our citizens and that is the primary aim of the MIIF,” he stressed.

He lamented that Ghana is placed at the bottom of the list of beneficiaries of our own riches. The largest value of Ghana’s resources he said is exactly the point when it leaves our shores in terms of refined products or monetizable securities and the country must be focused on returns beyond raw minerals.

“500 times more gold is traded everyday than it is mined and this happens in countries which have no gold for themselves,” he bemoaned.

He said the Agyapa Royalties deal is to support a Ghana beyond aid and “we must maximise the returns we get from our resources”.

He said the NPP government is ready to break the economy free from such old boundaries and encouraged Ghanaians to support the move.

He further explained that companies utilize their access to Ghana’s concessions and future resources as a means to invest in new exploration, new development, technology, diversification and ultimately to reduce their cost of borrowing.

For him, the country can leverage on the same parties that provide funding to companies but “we need to acknowledge that those with access to capital are not limited to our public institutions”.

What is MIIF and Agyapa Royalties?

MIIF was formed by the Ghanaian Parliament, pursuant to the Minerals Income Investment Fund Act, 2018 (Act 978) with the key objective of maximising the value of Ghana’s income from its mineral wealth for the benefit of the Ghanaian citizens and to maximise the minerals’ income in a sustainable and responsible manner. The aim of the fund is to ensure that Ghanaians fully benefit from the wealth that is created in the mining sector.

The purpose of MIIF is to hold and manage the equity interests of the Government of Ghana (“GoG”) in mining companies, receive mineral royalties due to the GoG from mining operations, provide for the management and investment of the assets of the Fund, finance further development of the mining sector, and monitor and improve flows into the mining sector.

Regardless of who is in power, MIIF said in a statement that it would be the custodian of Ghana’s future mineral revenues. In terms of the MIIF Act, the powers of MIIF include the creation of a Special Purpose Vehicle (“SPV”) in any jurisdiction in furtherance of its objectives, and the listing of the SPV on any reputable stock exchange that MIIF considers appropriate, and assignment of all or any of its rights to mineral income to a SPV in furtherance of the objects of MIIF.

Currently, MIIF is the sole shareholder of Agyapa Royalties, a SPV that is expected to list on the London and Ghana Stock Exchanges. Agyapa Royalties is expected to acquire a portion of the royalty, rent and other income from a number of gold assets in Ghana, comprising 12 producing gold mines, as well as four development assets, most of which are owned and run by major international gold mining companies.

The purpose of listing Agyapa Royalties Limited is to allow the Government of Ghana, via MIIF to raise non-debt capital to invest in the country without further increasing our national debt burden. The issue of equity in a company that is currently 100%-owned by the GoG through MIIF is a new and innovative way to raise funds that can be invested for the benefit of Ghanaian citizens into the future.

The GoG is seeking to raise a significant amount of funds from the listing of Agyapa Royalties Limited and will also expect to receive regular annual dividends in the future from Agyapa Royalties Limited, which will be reinvested in the country to finance strategic capital investments such as economic infrastructure to spur socio-economic development and enhance the lives of all Ghanaians.

“What is very important to remember is that MIIF will remain as the majority shareholder of Agyapa Royalties Limited. This means it will retain majority shareholder control and receive the majority of the Company’s dividends when declared and paid,” the statement stressed.

“Lastly, Ghana has always been and will always be a leader on the continent. This is but the latest example of our ability to be forward-thinking. We are the first government to implement this transformational and innovative way to raise funds. This is a pioneering template for Africa on how to achieve value add-on exports. It is the intention of Agyapa Royalties Limited to be an African royalty company and to leverage Ghana’s position as the leading gold producer in Africa to build an African royalty portfolio,” the release explained.

Opposition to the Agyapa deal

Not everyone is enthused about the deal as 15 Civil Society Organisations (CSOs) have kicked against the deal citing a lack of transparency, lack of consultation and elites being the beneficiaries.

The group, which forms the Alliance of CSOs working on Extractives, Anti-Corruption, and Good Governance has also cited a lack of a business strategy and a haste to carry out the processes.

Emphasising on the need to truncate the process, Dr. Steve Manteaw, the Communications Director of Integrated Social Development Centre (ISODEC) said at a press conference of the group that “it beats our imagination as to why an entity without a corporate strategy and approved funding plans will proceed to raise one billion dollars and give $500 million to the government in such an indecent deal especially when there is no known emergency to warrant such rush”.

The minority in parliament has raised similar concerns with former President John Dramani Mahama stating publicly that he would not respect a deal involving Agyapa if the NDC wins power in the 2020 elections.


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