TWN PROTESTS: Over Flawed Agreement with Goldfields

Dr Yao Graham, Third World Network

By Duke Tagoe

The Third World Network (TWN) has condemned the Development Agreement signed between the Goldfields Ghana Company Limited and the Government of Ghana over the Tarkwa and Damang mines. It’s called the agreement "flawed, immoral, illegal" and a “short change” of the Ghanaian people.

Under the deal, Goldfields will enjoy a 3% reduction in the corporate tax rate and a change in the royalty rate from between 3% to 5% effective January 2017. This arrangement will culminate into $ 33 million dollars profit for the company.

According to the deal, when the price for an ounce of gold is $2,299 dollars, the company will be required to pay 5% as royalties and could pay as low as 3% when the price of gold is at $1,300 dollars.

Nonetheless, the TWN disclosed that with the price of gold hovering around $1, 895 in 2011 and having dropped since, Goldfields might demand that they pay less than the limited royalty rate.

Speaking at a press briefing in Accra, Dr Yao Graham, Executive Officer of the TWN cautioned that although every mineral resource is entrusted into the care of the President, the Ghanaian people are the beneficial owners of the resource and the government has a trustee relationship in how it uses the resource.

He said that that trustee relationship meant that there must be a system of effective accountability of how the minerals are exploited.

Agreement Is Illegal

The Development Agreement under the Minerals and Mining Act demands that the Minister in charge of mineral resources can only enter into a development agreement under a mining lease with a person or company where the proposed investment by the company (in this case Goldfields) exceeds US $ five hundred million dollars.

But Goldfields has not brought the $500 million dollars required by the law.

Whilst speaking in an interview with an Accra based radio station, Joy Fm, Tony Aubynn, Chief Executive of the Ghana Minerals Commission justified the development agreement stating that “ Goldfields is perhaps the single largest investor across the two mines (Tarkwa and Damang) so they qualify by our own laws to sit with the Minister and get into a development agreement.”

He said that without an assurance of a stability agreement the mines will cease operations with dire implications for the economy.

This investment referred to by Tony Aubynn predates the day date Goldfields first set foot onto the shores of Ghana years ago and has no relation to the requirement of the law that the company had to propose an investment of $500 million dollars before a development agreement is granted.

Goldfields has also not made any commitment to save 2000 jobs at the Damang mines.

Furthermore, the stability agreement granted to the company will ensure that for 15 years, Goldfields will not be affected by subsequent changes to laws relating to exchange control, transfer of capital and dividend.

The company will also not be affected, by any new enactment, order or instrument that existed at the time of the stability agreement.

Dr Graham stressed that “a development agreement under the law can only be reached in respect of prospective investment of above 500 million dollars.

“It is not based on the fact that historically you’ve invested more than 500 million dollars and it cannot spring from the fact that gold prices have dropped and you may want to close your mine.”

The first public notice of the agreement came in an announcement by Goldfields to the Johannesburg stock exchange when the Ghanaian government had made no pronouncements to show how it was defending the best interest of the Ghanaian people in terms of the constitutional obligation under the minerals and mining act.

Abuse of Process by Parliament in the Goldfields Deal

On the 17^th of March, parliament waived a 48 hour notice period, tabled a motion and unanimously adopted the Golfields agreement without debate.

Dr Graham, considers the move as an abuse of process as Ghana’s mineral resources are being handled as personal properties for a few people in government.

“It has become routine now for agreements on natural resources to be passed by waiving the terms of the standing order which require at least 48 hours notice,” he said

According to him, the purpose of allowing a notice period is for the reason that because parliament has an oversight responsibility and it is supposed to be acting in the interest of the people as a check on how the executive uses power, parliament must seek comments from the public before laws are enacted.

He said also that parliament has a duty to convince the citizens that the waiver of the notice period and the manner in which the agreement was passed through parliament is not arbitrary or capricious.

Full Disclosure

TWN demands that since the Mines and Energy committee of parliament held that the terms of the law had been met and based on that information parliament unanimously passed a motion that granted a development agreement to Goldields, government must be heard and it must give justification which is consistent with section 49 of the Minerals and Mining Act, which provides the framework for entering into a development agreement and which indicates that Goldfields was going to make an investment of more than 500 million dollars deserving of a stability agreement adding that anything else is an illegality.

According to Dr Graham, without that disclosure and if the agreement is made to stand, a precedent will have been set for other companies to demand a change in the taxes that they pay.

Mining Contract Review Committee

Goldfields’ development agreement also stand in contravention to the recommendation of the Mining Contract Review Committee, set by the government in 2012 chaired by Professor Akilagpa Sawyerr to review existing contracts and to make proposals for future stability and other developments in the gold mining sector.

The Committee recommended that the royalty rate should be raised to 5%.

By entering into the development agreement with Goldfields, the recommendations of the Akilagpa committee which sought to safeguard the interest of Ghana have been thrown away.

Dr Graham expressed worry  at a tradition of policy incoherence and key decisions being taken in an incoherent manner to the disadvantage of citizens.

He recalled that when the Kufuor government signed an agreement with Newmont it destroyed the fabric of the existing negotiating framework within the mining sector because it offered Newmont terms that nobody had before and some of which were considered unconstitutional.

 “Are we getting a repeat of the Newmont type of thing, or this is a process which can stand scrutiny,” he questioned.

 Dr Graham also called for full disclosure of existing agreement with all mining companies including the recently renegotiated Newmont agreement and the justifications that the committees that renegotiated them offered.

Meanwhile, the National Coalition on Mining has kicked against the Goldfields deal and is expected to start a full blown campaign to reverse it.

Editorial

Mining

 The big mining companies operating in Ghana are happy with the impression that only so-called illegal mining is a problem.

The undue focus on illegal mining makes it possible for the big mining companies to get away with mass murder when the only difference is that the big ones have official permission to do exactly what the small ones do without official permission.

The record shows that all mining operations in Ghana pollute the environment and deprive many rural dwellers of the land.

It is also a fact that all cost- benefit analysis of mining in Ghana point to the fact that there is very little or no benefit from mining operations to the people of Ghana.

The Insight believes that the time has come to do a serious analysis of the mining industry in the country and take the appropriate steps to ensure that the country does not continue to suffer for the super profit of multi-national corporations and other gold hunters.

This is an urgent task

TUC SPEAKS OUT

Kofi Asamoah (L) Justice Henaku (R)

By Duke Nii Amartey Tagoe

Brother Kofi Asamoah, Secretary General of the Trades Union Congress has called for a complete structural transformation of the national economy in order to rescue Ghana from the crises of underdevelopment.

He was speaking at a public forum held at the Hall of Trade Unions on “The Impact of the 24^th February Coup Detat on Trade Unionism in Ghana” as part of activities marking the 50^th anniversary of the overthrow of Osagyefo Dr Kwame Nkrumah, first President of Ghana by the Central Intelligence Agency of the USA and its local collaborators.

According to him, the coup detat of 24^th February 1966, brought in its wake a ferocious swing in government economic policy from “development” to “management”.

This he noted, ushered in the period when employment concerns of many Ghanaians were relegated to the background and vigorous efforts towards employment creation were halted.

The Role of the NLC in the Sabotage of Workers

Kofi Asamoah recounted with pain that by the time the National Liberation Council handed over power in 1970, “more than 64,000 direct public sector jobs had been cut” adding that “registered unemployment by late 1970 had jumped to between 350,000 and 600,000”.

The result of this dastardly act was that whilst there was a drastic reduction in the membership and influence of the unions, many labour leaders had to take refuge under beds for fear of persecution and several others simply fled the country. This man hunt and intimidation continued right under the Busia regime.

The role of the Coup in the Ideological degeneration of Trade Unionism

Trade Unions the world over are formed and made to function on the basis of ideology. Kofi Asamoah therefore holds that the 24^th February Coup made a conscious effort at the elimination of ideological manifestations of the activities of trade unions in Ghana, adding that “this loss of an ideological grounding has led to the festering of the fragmentation within the trade union movement”.

Prof. Sawyerr, Ebow Tawia, Prof Delle &Algerian Ambassador

Worse still, critical historical documents of the Congresses of the TUC cannot be found and might have been lost forever in what the TUC Secretary General has likened to “ISIS destruction of archeological material and historical sites”.

In a brief remark, Kwesi Pratt Jnr, a leading member of the Socialist Forum of Ghana stated that on the 31^st of December 1963, J.W Russel, British Ambassador in Addis Ababa sent a cable to the Foreign Office in which he made some ghastly comments about Kwame Nkrumah.

Mr Pratt said: “the coup of February 1966 was not about bad governance or dictatorship of Nkrumah and the CPP, but was a crime committed against an independent people striving to break away from the yoke of colonialism.”

According to him, the forces that overthrew Nkrumah did so purely because they wanted to hold back Ghana’s progress in the continuing domination of Africa in the fashion of classical colonialism.

In the cable sent to the Foreign Office, J.W Russel said “Nkrumah is our enemy, he is determined to complete our expulsion from an Africa he aspires to dominate absolutely. We must find blacks who can, and although it would be counterproductive publicly to damn them with our old colonial kiss, yet surely it is not beyond our ingenuity to find effective ways of affording them discreet and legitimate support? I cannot for the life of me see why we should subscribe our conscience to help the Saltimbance of Accra engross the rest of Africa”

Nana Frimpongmaa Sarpong Kumankuma, also called on progressive forces to unite in their effort towards the building of a new society based on the principles of equality for all.

“ 50 years after that sordid incident that halted the rapid transformation of our dear country, the time has come for each and every one of us to move on and to work towards the realization of the State we yearn to see. Every single day must count in the mobilization of the disadvantaged and the workers of this country towards national reconstruction” she said.

The Trades Union Congress says it will continue to engage and build alliances with progressive forces to ensure that the alternative path to development is realized in the shortest possible time.

Mr Kofi Asamoah has thrown a challenge to progressive forces to mobilize and build alliances to galvanise public support for an alternative development paradigm in the face of neoliberal hegemony.

The public forum which was jointly organized by the Convention Peoples Party and the Socialist Forum of Ghana was chaired by Mr Justice Kofi Henaku, SFG Secretary.

SECRET 3

How Britain Tried To Get Nkrumah To Change

Osagyefo Dr Kwame Nkrumah

The letters contained in Britain’s Foreign Office Secret Files make it clear that Britain identified Nkrumah as a threat to its strategic interests and therefore sought means to make him change course.

The problem however was what to use to put pressure on Nkrumah.

 Britain had already cut its aid to Ghana drastically, but that had not moved Nkrumah.

An exasperated British official, Douglas Carter wonders “indeed the question we have to ask ourselves is whether it is any longer possible for the British government to influence President Nkrumah in such a way as to cause him to alter the basic orientation of his policies. I believe that short of a boycott of Ghana’s cocoa, would be damaging to us as well as contrary to our whole trade policy, there are no economic levers which we can effectively use to influence Nkrumah”.

”Any attempt on our part to exercise pressure through economic action would probably harm our interests more than him”.

After all, Britain was still Ghana’s biggest customer and supplier.

Interestingly, the documents reveal that at some point the British establishment considered the Asantehene as a possible replacement for Osagyefo Dr Kwame Nkrumah.

The documents also list close associates of Nkrumah, who was working against him and his project of unifying Africa.

Editorial

BRITAIN AND AFRICAN UNITY

That African states continue in their non-viable conditions dictated by the Berlin Conference is partly because the leaders on the continent have refused to serve the interests of their people.

As revealed by the recently declassified documents of the Foreign and Commonwealth Office, part of the reason for the failure to unite Africa is the direct sabotage of western countries especially Britain.

The West rightly saw the unification of Africa as a threat to its stranglehold on Africa and did everything possible to sabotage the continental project.

At one stage the British establishment even tried to use one of Nkrumah’s own men to write a book which would discredit the Osagyefo’s effort at continental unity.

The Insight is publishing these declassified documents as part of the effort to learn the important lessons of history.

The African people need to organize themselves to prevent anti-African forces from sabotaging the forward march of the progressive forces.

TAKE OVER OF KETA LAGOON FOR $30,000

7000 acres of Keta Lagoon given to Kensington Industries limited

By Duke Nii Amartey Tagoe

It has happened again! The pillage goes on and on. The Keta Lagoon in the Volta Region has been handed over to a salt mining company for $30,000 (Thirty Thousand Dollars).

The deal between the Ghana Minerals Commission and Kensington Industries Limited of India, will enable the company grab 7000 acres of the entire lagoon whilst 300metres at the periphery representing 3 percent (3%) of the lagoon will be left for the local salt miners.

What is worse, the company has departed from the agreement it signed with the Minerals Commission to use sea brine for salt production and has resorted to the use of surface water and underground pool by means of pipes and very huge pumping machines.

It has also emerged that long before Kensington Industries Limited was granted a licence to mine salt in the Adina-Denu area, it had already encroached on lands belonging to the neighboring communities in flagrant violation of the Mineral and Minning Act.

Babulal Goud, New MD, Kensington Industries Limited

In a letter dated 18^th November 2009 addressed to the elders of the Dogbekope Community , Rajesh Mehte, a director of the company, “acknowledged having encroached on their lands unlawfully without having been granted a licence. We  apologise and withdraw immediately.”

Janet Aglodo, a salt miner said “the fresh water, that used to flow from Togo into the lagoon, bringing in fish in the rainy season has been blocked by roads and dams constructed by the company. As a result the annual fishing and salt winning seasons that used to bring relief to the people have become a thing of the past since the lagoon dries up prematurely.”

An immovable fishing input on which fish traps were laid in the lagoon and which served as roosts and breeding grounds for water birds has been destroyed.

“It is highly unthinkable and we would have thought that by now the government, which we massively support and rally behind, would have made a statement. How can this government apportion the Keta Lagoon to foreigners to the neglect of his own subjects and indigenes who derive their entire livelihood and very existence from the lagoon” said Cynthia Gali of the of the Ketu-Keta Salt Winners Association.

Mr Pascal Lamptey, MCE, Ketu-South

Pascal Lamptey, Municipal Chief Executive (MCE) of the Ketu South Municipal Assembly has confirmed that the Environmental Protection Agency (EPA) failed to undertake a proper environmental impact assessment before the license was granted to the company. 

He revealed that Kensington Industries Limited reneged on its promises to provide some infrastructure for the area as part of its corporate social responsibility and that has led to mistrust between the two parties.

Mr Lamptey said as a representative of the President of Ghana in the area, his most crucial obligation is to ensure that investment was brought to the area and jobs are created for the teeming youths. 

According to him the government seeks to relegate under-development to the past by encouraging foreign investment in places that production was low for rapid growth. He said he has set up a sensitization committee to help the community and the company co-habitate with each other, leading to what be believes would bring about “peaceful development.”

That assertion by the Municipal Chief Executive has however  been challenged by the National Coalition on Mining of the Third World Network (TWN). The coalition has expressed shock at the displacement and the destruction of the livelihood of more than three thousand eight hundred and ninety eight people (3898) in one single swoop.

The TWN contends that the major task and expectation of the Kensington Industries Limited is to make super profits for its shareholders back home by the use of cheap labour and wondered how the local people will benefit from this deal.

In a letter dated 25^th January 2010 and addressed the Managing Director of the Kensington Industries Limited, Kofi Tetteh, Principal Sectoral Planning and Policy Officer of the Ghana Minerals Commission stated that the Commission has “favourably recommended to the Minister of Lands and Natural Resources to grant you a fifteen year licence to mine salt in the Keta Laggon”

ASP Naa Atolgo Agbogne

ASP Naa Atolgo Agbogne at the Agbozome District Police Command has confirmed the arrest of some sixteen people in the recent clashes between the company and the youths of the area on the 2^nd of December 2015.

According to him, such disturbances by the youths had halted operations of the company and had rendered it incapable of producing for a very long time. He wondered how the company could meet its corporate responsibilities in the area when they were being prevented from doing business.

The sixteen local salt miners are languishing in jail at the Keta Divisional Divisional Command whilst another receiving treatment for bullet wounds at the Korle Bu Teaching Hospital has been chained to his bed to avoid escape as he awaits prosecution.

Editorial

Something Is Wrong

The Afienya Youth Leadership Training Centre was perhaps the first of its kind

It was established as a collaboration between the National Youth Council (NYC) and the Frederich Neumann Foundation of the then West Germany.

The centre was to train young people in animal husbandry, crop farming, blacksmithing, building construction and other areas of interest.

After graduation, the products of the centre were to be encouraged to form cooperatives around the country to provide employment for themselves and young people in their communities.

The graduates were also seen as stimuli to accelerated rural development.

So far about nine of such institutions have been established throughout the country over a period of about 42 years.

The sad thing is that these centres are collapsing as a direct result of lack of funding.

However, how can we say that we have a serious commitment to fighting youth unemployment when we allow these institutions to collapse?

Who will save the Youth Leadership Training Centres?

Something is definitely wrong!