The Institute of Economic Affairs (IEA) has challenged the prevailing legislative direction of Ghana’s extractive sector, advocating for a transition from the traditional royalty-based regime to service contracts model that ensures 100% state ownership.
In a press briefing in Accra, IEA renewed its call for national ownership of mineral resources such as Gold, Lithium, Bauxite, etc.
This call comes in response to the recent passage of the Minerals and Mining (Royalty) Regulations, 2025, and the simultaneous reduction of the Growth and Sustainability Levy (GSL) from 3% to 1%, which the IEA views as a missed opportunity to assert national sovereignty.
By shifting to service contracts, the IEA argued that the state would move from being a passive collector of meager percentages to a primary owner that hires technical expertise to extract wealth for the direct benefit of the Ghanaian economy.
“Ghana must have full ownership of its natural and mineral resources; and must exercise this ownership right by engaging private sector local and foreign expertise strictly through service contracts that preserve national control and maximize benefits for the country’s industrial transformation.”
Institute of Economic Affairs (IEA)
Expanding on this vision, the Institute expressed profound concern over the Parliamentary ratification of the Ewoyaa Lithium Mining Lease on March 19, 2026.
This agreement grants Barari DV Ltd, a subsidiary of Atlantic Lithium, the right to mine the nation’s strategic lithium reserves for the next 15 years under what the IEA describes as a “colonial system of royalties.”
The IEA contends that while political actors appear to be echoing the concerns of foreign mining interests, the true aspirations of the people anchored in resource sovereignty are being sidelined.
They maintain that the current trend of “cheaply parceling away” resources must stop, especially as existing leases expire, providing a legal window to restructure the sector without breaching contractual obligations.
Breaking the Colonial Royalty Paradigm
The IEA’s rejection of the sliding-scale royalty regime which ranges from 5% to 12% for gold and lithium is rooted in the belief that such structures are inherently inequitable.
In their view, these “outdated, colonial royalty-based paradigms” capture only a fraction of the true value of the mineral wealth.
Under the proposed service contract model, the state would retain 100% of the minerals produced, paying the mining companies a fixed fee for their extraction services rather than surrendering the resource itself.
This ensures that the “financial, economic, and security dividends” of the mining sector stay within the country, rather than being exported as raw profit by multinational corporations.
Strategic Benefits for Industrial Transformation
A shift toward service contracts offers a transformative pathway for Ghana’s industrialization and economic stability.
By maintaining ownership of the physical minerals, the government can strategically direct these resources into local value-addition industries, such as lithium battery manufacturing or gold refineries, rather than exporting raw ores.
This model would significantly “boost foreign exchange inflows” and provide the necessary capital to support the country’s structural transformation.
Furthermore, it empowers the domestic private sector; the IEA notes that Ghana already possesses a “deep pool of experienced mining professionals” and local firms capable of managing large-scale operations under these service arrangements.
Strengthening National Sovereignty and Prosperity
The proposal is framed as a matter of constitutional and international right, citing the principle of “Permanent Sovereignty over Natural Resources” as grounded in the 1992 Constitution and UN Resolution 1803.
The IEA argued that the era of “financial colonialism” must end to halt the spread of poverty.
By adopting the service contract model successfully utilized by nations like Norway, Botswana, and various OPEC members Ghana can ensure that its natural resources act as a catalyst for “long-term structural transformation.”
This approach would effectively redirect resource wealth toward national development, creating high-quality jobs and technology transfer that the current royalty system simply cannot deliver.
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