Raw gold brings Ghana only 1–5% profit — Prof Bokpin urges value addition

A professor of finance at the University of Ghana Business School, Godfred Bokpin, has said Ghana’s economy was being weakened by short-term policies in mining and agriculture, which were failing to deliver meaningful profits, jobs, or tax revenue.

Speaking in a radio interview on Joy FM on Wednesday [October 1, 2025], Prof Bokpin argued that the country’s reliance on exporting raw gold is unproductive.

“When you do the analysis, the maximum profit you can get from exporting raw gold like we have been doing is between one and five per cent. The maximum profit,” he said.

By contrast, he explained that processing gold and investing in responsible mining would yield much higher returns. “When you process your gold, you do responsible mining, and you want to take advantage of the entire value chain, the minimum profit that you derive is 10 per cent. Minimum. So it can go as high as possible,” he stated.

Prof Bokpin said this gap explains why Ghana’s gold earnings are not translating into real development.

“Even though we are saying that there is uptake of gold exports recently, the government told us that gold exports have gotten billions of dollars — that is not spendable money. That is not impacting our revenue envelopes significantly. That is not money for President Akufo-Addo to spend on infrastructure and transform it,” he argued.

He cited the Bank of Ghana’s records, noting that when the central bank participated in the gold-for-oil scheme “they booked losses.”

He warned that Ghana is enriching other countries through the export of raw minerals. He pointed to the United Arab Emirates as an example.

“More than 80 per cent of our gold export now is going to the United Arab Emirates. They are the ones who have set up manufacturing companies, adding value to raw gold that is exported from Ghana in London, and they wash it and resell it to the rest of the world for higher value. It is like we are not going to school,” he said.

Turning to agriculture, Prof Bokpin said the sector, despite contributing nearly a fifth of national output, adds little to tax revenue.

“If you speak agriculture, its contribution to GDP on every course is just around 17 per cent. Agriculture is delivering close to 10 per cent of their tax revenue. If it comes to Ghana, agriculture is delivering less than 1 percent,” he said.

He blamed the poor performance on the absence of business-driven policies.

“We’ve left it entirely to peasants, farmers, and the rest of them. We are not applying business sense to agriculture. Feeding people is business. It’s wealth creation. So we are losing from that perspective,” he added.

According to Prof Bokpin, both mining and agriculture are failing to create sustainable jobs. “If you compare other countries that are doing proper mining, and you compare employment generation to that of Ghana, you can see that in terms of business job creation, employment generation, the employment response to growth in the mining and quarrying sector is very weak,” he noted.

He referred to World Bank data which showed that between 2012 and 2023 Ghana’s economy created only 250,000 net jobs, while 2.7 million people entered the labour market.

He linked this weak performance to leadership that prioritises immediate gains over long-term transformation. “This is not the kind of leadership we voted for,” he said.

“That would be weak leadership  leadership that puts a premium on its short-term interest at the expense of medium and long-term economic transformation.”

Prof Bokpin disclosed that he had raised concerns with international organisations, stressing that irresponsible mining must now be treated as an economic emergency.

“I have sent a memo to certain international organisations and the position we are pushing is that we are at the point where we must recognise the macro-criticality of irresponsible mining in our macro-framework modelling. There cannot be any sustainable modelling of Ghana’s macro-economic framework and exclude irresponsible mining in the devastation that lies ahead of us,” he said.

He added that Ghana must urgently reflect on how it manages its natural resources.

“We’ve got to sit down and ask ourselves whether we are benefiting optimally from our natural resources that have an expiry date. Remember, it will not be there forever. And whether there is no other way that we can use this money in a manner that benefits Ghanaians broadly even for generations yet unborn, so that the next generation will not feel sorry that we came ahead of them,” he said.

He ended with a warning that future generations would pay for today’s neglect. Quoting scripture, he said:

“The fathers have eaten sour grapes and the teeth of the children have been set on edge. This is where we are.”