The Institute of Economic Affairs (IEA) has rejected the government’s proposed sliding-scale mineral royalty regime, describing it as a continuation of a “colonial” system that deprives Ghana of the full value of its natural resources.

In a press release today, the influential policy institute criticized the draft Minerals and Mining (Royalty) Regulations 2025, which propose royalty rates ranging from 5% to 12% for minerals such as gold and lithium, and a flat 5% for diamonds, bauxite, manganese, salt, limestone, and iron ore.

The IEA also expressed concern over recent reports that the Ministry of Lands and Natural Resources is considering a separate bill to introduce a 9%–12% sliding-scale royalty across the mining sector. The institute labeled the Ministry’s position “confounding and contradictory” to President John Mahama’s publicly stated vision for resource sovereignty.

The release highlights several speeches in which President Mahama called for a fundamental shift in how Ghana manages its natural resources. In March 2025, he agreed with former Chief Justice Sophia Akuffo that mining agreements needed review, stating, “Ghana must earn more from its natural resource endowment.”

At the UN General Assembly in September 2025, he declared that “Africa must exercise sovereignty over its natural resources” and that the era of granting vast concessions to foreign interests “must come to an end.”

At the World Economic Forum in Davos in January 2026, President Mahama lamented, “We supply the world’s critical minerals but capture almost none of the value. This isn’t sovereignty. It is a trap.”

“Whereas the President has moved on, the Minister of Lands and Natural Resources is still propagating the old colonial royalty-based paradigm,” the IEA stated. “The President is ahead of his Ministers!”

The IEA argues that royalty systems, whether fixed or sliding-scale, are inherently flawed because they transfer ownership and control to foreign companies, leaving Ghana with only a small fraction of the resource wealth.

Instead, the institute advocates for a model of full national ownership, where the state retains control and contracts private firms, local or foreign, strictly through service agreements.

This approach, the IEA notes, has been successfully adopted by countries such as Norway, Botswana, Chile, and several OPEC and West African nations.

“National ownership and effective management of Ghana’s resources would yield financial, economic, and national security dividends far exceeding any royalty percentage,” the release asserts.

With multiple mining leases set to expire in the coming years, the IEA sees a historic chance for Ghana to break from the past without breaching existing contracts. “We urge the Government not to renew expiring leases, but instead to pursue a new trajectory anchored in state ownership and the use of service contracts,” the institute stated.

The IEA also dismissed arguments that Ghana lacks the technical capacity or capital to manage its resources, pointing to the existing pool of experienced mining professionals and Ghanaian-owned firms already operating in the sector.

“What has been lacking is the political will to act decisively,” it concluded.

The press release ends with a firm rejection of the Ministry’s proposed royalty reform and an endorsement of President Mahama’s sovereignty-focused agenda.

"Ghana must abandon the colonial course of giving away ownership rights to foreign companies,” the IEA declared, urging a shift toward a modern framework that ensures “full national ownership for the good of Ghana."