Accra: Chief Executive Officer of the Ghana Chamber of Mines, Kenneth Ashigbey, has warned that frequent changes in Ghana's fiscal policies could make it more expensive for mining companies to raise money for projects. He said uncertainty over taxes and other fiscal measures makes it difficult for investors to predict the cost of their projects and the returns they are likely to make.
According to Ghana Web, Ashigbey emphasized that mining companies spend significant amounts of money before they begin earning from their operations. He cited a Newmont project which required more than US$1 billion before producing its first ounce of gold. However, Ashigbey noted that while investors can work with existing tax rates, they struggle when those policies are changed without sufficient certainty.
Ashigbey stated, "The thing that unpredictability does is that it makes raising funds for projects in Ghana very expensive. It's the reason why you need a stability agreement." He explained that investors need to know the numbers they will use when securing funds for such projects because the money comes from people and institutions expecting returns. "What they cannot handle is their unpredictability because they don't know what numbers to use at a particular point," he added.
Ashigbey further urged the government to protect the country's fiscal interests, especially when gold and other mineral prices increase sharply. He called for clear rules on stability agreements, suggesting that the government could require companies to meet specific investment targets before receiving fiscal assurances. He concluded that such an approach would give investors confidence while allowing the state to protect its revenue when market conditions change.