Ghana, Africa’s top gold producer, has inaugurated a new refinery to enhance the value extracted from its mineral resources. The Royal Ghana Gold Refinery is designed to process 400 kilograms of gold daily, primarily sourced from artisanal and small-scale mines, which contribute significantly to Ghana’s annual gold output of around 4 million ounces. Additionally, a considerable amount of gold is illicitly produced by local miners known as ‘galamsey,’ underscoring the need for formalized refining processes.
The establishment of this refinery marks a pivotal step in combating gold smuggling, a persistent challenge for Ghana. By providing a legitimate market for small-scale miners, the refinery aims to foster transparency and accountability in the gold trade, as highlighted by Bank of Ghana Governor Ernest Addison. Notably, Rosy Royal Minerals Ltd. of India holds an 80% stake in the refinery, with the remaining share owned by the central bank.
Efforts to formalize Ghana’s small-scale gold mining sector have gained momentum, exemplified by the central bank’s initiative to purchase $5 billion worth of gold from these miners to bolster the country’s foreign-exchange reserves. This strategy mirrors similar moves by other African nations like Uganda and Madagascar, reflecting a broader continental trend towards value addition in resource exploitation before exportation.
Ghana’s gold production surged by 8.3% in 2023, underscoring the nation’s historical significance as a major player in the global gold market. Finance Minister Mohammed Amin Adam emphasized the imperative of maximizing value across the entire gold supply chain to fully leverage Ghana’s status as one of the world’s top gold producers.
The rich gold mining heritage of present-day Ghana, once known as the Gold Coast during British colonial rule, underscores the country’s enduring relationship with the precious metal. Ghanaian authorities are currently engaging with the London Bullion Market Association to secure certification for responsibly sourced gold, a move that could broaden market access for Ghana’s small-scale miners.
Attaining certification from the LBMA would facilitate easier trade of Ghanaian gold by aligning with stringent sourcing standards demanded by major global purchasers. Eric Santeng, a director at Royal Ghana Gold, expressed optimism about achieving LBMA status, emphasizing the collective effort required to meet the association’s criteria.
The establishment of the Royal Ghana Gold Refinery represents a significant milestone in Ghana’s quest to add value to its natural resources, signaling a shift towards sustainable and transparent gold trading practices that could serve as a blueprint for other African nations.
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