The small-scale mining sector contributes greatly to the Ghanaian mining sector accounting for about 40% of gold output in 2019. There has been a significant growth in gold production, supported by increasing prices leading to an increase in total revenue over the past two decades.
Due to the inadequate access to finance for the small-scale sector, the industry has witnessed the influx of foreign financing operations. Ghana has lost revenue due to capital flight and the use of non-official channels of exporting the gold by these foreigners.
The strategic objective of the SSMIP is to transform wholly owned Ghanaian small-scale mining entities into mid-tier or large scale in the long run, and to formalize the activities of small-scale miners in Ghana.
The SSMIP seeks to provide smart financing and investment facilities for potential and viable local operators. MIIF will also provide funding for mining equipment and consumables to beneficiaries.
Interested miners with small-scale licensed concessions of land in a designated area or concession allocated by the Minerals Commission (MINCOM) operating in either hard rock or alluvial mining can apply to the programme.
The economic benefit of the program is to create adequate employment and develop local capacity in the Ghanaian small-scale mining sector and to create ready markets for the small-scale entities.
SPECIAL PURPOSE VEHICLES (SPVs)
The Minerals Income Investment Fund (MIIF) incorporated Agyapa Royalties Limited, a pure gold royalties company,in November 2019, and will receive a portion of the Fund’s gold royalty’s income from specified mining leases. Agyapa Royalties will specialise in providing finance to fund exploration and production projects for mining companies and in return, receive royalties on the project’s production, or rights to a stream of gold. The key benefit of royalty companies is that they provide exposure to a mining company’s performance and growth without exposure to operating and capital costs.
It is the MIIF’s intention to list Agyapa in order to raise a diversified source of long term capital. Currently, Agyapa is 100% owned by MIIF on behalf of the Government of Ghana (GoG). Once the Company is listed on the London Stock Exchange and Ghana Stock Exchange, MIIF will be the largest shareholder, hence Agyapa Royalties will be ultimately majority-owned by the GoG.