The Minerals Income Investment Fund (MIIF) seeks co-investment partners in its bid to invest in the entire minerals value chain in Ghana. MIIF is ready to co-invest and create a de-risking mechanism for investors says Edward Nana Yaw Koranteng, the Chief Executive Officer of the Fund.
The Fund which has been described as “perhaps Ghana’s most important lever of development” took centre stage at the two-day Ghana International Opportunities Summit (GHIOS) at the Hilton Hotel in Park Lane, London with its offering of creating wealth through sustainable investments for Ghana.
Creation of Africa’s Largest Minerals Sovereign Wealth Fund
“We are building Africa’s biggest sovereign minerals fund,” said Edward Nana Yaw Koranteng. Our Assets Under Management has grown from circa $125 Million to current $400 million within 15 months and on track to hit $1 Billion in 2027. MIIF has a robust pipeline of investments and has adopted aggressive and revolutionary mechanisms in expanding its royalty’s base. The opportunities in Ghana are enormous and goes beyond gold for which Ghana is known for and even regained top spot as number one gold producer in Africa. The opportunities for investors also cover the salt sector, lithium, bauxite, iron ore, graphite, feldspar, chemical plants and refineries across the value delivery chains of the minerals. We are inviting investors to seize these opportunities in the mining sector with MIIF as a partner.” Koranteng said
MIIF, a statutory investment company was created by the Minerals Income Investment Fund Act, 2018 (Act 978) as amended, to receive mineral royalties on behalf of the state, invest the mineral royalties responsibly and manage the equity stake of government in large scale mining companies operating in the country.
The fund went into high gear in 2021 when the CEO, Edward Nana Yaw Koranteng and a new Board of Directors were appointed by Ghana’s President, Nana Akufo-Addo. Since then, the trajectory of the fund has been remarkable and in 2022 outperformed benchmarked global indices such as s S&P 500, FTSE 100, and the GSE-CI.
Investments in the Critical Minerals Sector
A reclassification of minerals such as Manganese, Bauxite Lithium and Salt as ‘Priority or Critical Minerals’ has refocussed attention on their value chain development through deliberate investments by the Fund. “We see vast opportunities in Manganese, Lithium and Salt especially in this era of decarbonisation and the regionalisation of development and trade in Africa, Koranteng told the Summit, which was attended by the Vice President of Ghana, Dr. Mahmud Bawumia.
“At present, we are negotiating investments in Atlantic Lithium, an Australian company which has discovered commercial quantities of Lithium in Ewoayaa near Mankessim, in the Central region of Ghana. We are working on other potential significant lithium finds in Ghana. MIIF intends to invest in the processing plants for these transitive minerals in line with the president’s vision of making Ghana a battery hub in Africa and a centre for Electronic Vehicles in Africa by leveraging on the current Ghana automobile development plan. Ultimately, we want to become a centre for Electronic Vehicle (EV) assembling or manufacturing for the whole of Africa. We are studying the best and proper way to achieve this grand plan,” said Koranteng.
“MIIF is currently going through the process of a potential investment in industrial salt from the Ada Songhor salt basin in Ghana which is managed by Electrochem Ghana. Salt is a mineral which has over 14,000 uses covering textiles, food processing, oil refining, pharmaceuticals, caustic soda among others and essential to the industrial needs of Ghana and West Africa. As the only prime industrial salt enclave in West Africa, the Ada project would feed the oil and gas and refining in Nigeria for example. The Ada Songhor Salt project sits on 41,000 acres and at full development will become Sub-Saharan Africa’s largest Salt producing company ahead of Walvis Bay in Namibia.”
Leveraging Ghana’s gold to create more opportunities.
On Gold, Mr. Koranteng bemoaned the lack of beneficiation which rather provides long term investment opportunities. “We have been mining gold for over four hundred (400) years in Ghana with very little beneficiation. MIIF seeks to invest along the value chain with emphasis on Ghanaian mining support services”.
MIIF’s plan is to create a mining eco-system of opportunities through its investments especially in the gold mining sector which employs more than ten million people directly and indirectly. In this regard, MIIF has launched a US$60 Million dollars investment initiative to support the gold small-scale mining sector. The small-scale gold mining sector is fully indigenised and contributes 30% to 40% of Ghana’s total gold output but the sector remains informal and fraught with illegal mining and environmental challenges. MIIF’s initiative dubbed the Small-Scale Mining Incubation Program (SSMIP) will contribute to the formalisation of the sector and lead to the creation of well-structured Ghanaian junior mines.
The SSMIP involves the rigorous selection of licenced small scale mining companies with proven reserves. In this regard, MIIF shall invest equity in selected mines after a rigorous process, by imbuing sound corporate governance, support with the acquisition of machinery, provision of initial working capital, provision of technical support to support efficient mining, and access to market through the MIIF Trade Desk. “Our plan is to list these companies on the Ghana Stock Exchange or the Alternative Exchange and even push the possibility of listing on the Toronto Stock Exchange. This is the vision of President Nana Akuffo Addo, for this important sector, that it be supported and formalised in this vein leading to the creation of local Ghanaian mining champions.” Mr. Koranteng emphasised.
Developing the capital market
Mr Koranteng indicated that, MIIF has signed an MOU with the Ghana Stock Exchange which has over the past twenty years been one of the top performing in Africa. The arrangement with the GSE is essentially on two main objectives, to push mining entities in which MIIF has invested on to the Ghana Stock Exchange (GSE). An example of this is seen in the Canadian listed Asante Gold Corporation in which MIIF has a significant holding which is now listed on the GSE. The second objective is to list the MIIF Gold Backed Exchange Traded Fund. “We are designing a gold backed Exchange Traded Fund (ETF) which would be listed on the GSE. Our plan is to have this listed by end of the year. The ETFs and the listing of mining assets will deepen the Ghanaian capital markets and provide alternative investments or alternative asset classes to Pension Funds and investors as a whole. We believe this is an opportunity for Ghanaians in the diaspora and investors worldwide.” Mr. Koranteng said