Ghana loses gold top spot as 2021 output falls to 13-year low
Ghana’s gold production fell 30% last year to its lowest in more than a decade, knocking the country off its spot as Africa’s top producer, the president of the mines chamber said on Friday, blaming a taxation change and operational challenges.
He predicted production should strengthen this year as the mines address the challenges. The government has also announced a plan to purchase local gold that could encourage output.
After a new tax was imposed on small-scale operations, output fell to 2.818-million ounces in 2021 – the lowest level since 2008 – from 4.022-million ounces in 2020.
The West African country has vied with South Africa in recent years to be the continent’s top gold miner. Ghana had already faced a 12% drop in production in 2020 but retained the top spot.
“A combination of concurrent reductions in the output of both large and small-scale gold producers led to a 29.92% fall in the production of the country’s dominant mineral, gold,” Mortoti told the chamber’s annual meeting.
Output from large-scale producers fell 4.44% to 2.72-million ounces with most mines seeing a decline in production due to “operation-related challenges,” said Mortoti, without providing further details.
A significant increase in output from Ghanaian company Abosso Goldfields limited the fall, he said, adding production should rebound as mines address these challenges.
Output from small-scale producers fell nearly 92% to 0.098-million ounces, said Mortoti, attributing the collapse to a 3% withholding tax imposed on their output in 2019.
Small-scale gold production also fell significantly from 2019 to 2020, when supply chain disruptions caused by the pandemic were also a factor.
Small-scale miners are believed to be producing but are exporting through non-official channels not captured in the national figures, said Mortoti.
Ghana said in May it had started a programme to purchase local gold in bulk to raise the gold component of its reserves and strengthen the cedi currency, the Central Bank governor said last month.
