Ghanaian firms to get greater share of mining procurement market

November 6, 2017

An innovative national suppliers development programme (NSDP) that will secure a greater share of the annual mining procurement market, exceeding $1 billion, for Ghanaian firms has been launched in Accra.

The launch formed part of a two-day meeting of stakeholders in the mining sector to discuss how domestic manufacturers and suppliers of goods and services could take advantage of opportunities in the mining value chain to generate growth and create jobs.

The meeting was organised by the African Minerals Development Centre (AMDC), the African Center for Economic Transformation (ACET) and the German Federal Institute for Geosciences and Natural Resources (BGR).

It was on the theme: “Strengthening the mining sector’s contribution to local and national development”.

Supply hub

The Vice-President, Dr. Mahamudu Bawumia, whose speech was read on his behalf at the ceremony, said the government had endorsed the NSDP because of its alignment with the government, own priority of private sector-led industrialisation and economic transformation.

He said the government had, in collaboration with the mining industry and domestic businesses, set up a national programme to support the development of a world-class and competitive supply chain.

“The goal is to use the mining sector as a launch pad to stimulate economic linkages so that Ghana can become the supply hub for large mining industries operating locally and beyond our frontiers,” he added.

Dr Bawumia further indicated that the new initiative would build and expand on existing policies, such as the government’s local content and the one-district, one-factory policies.

Mining vision

The Minister of Lands and Natural Resources, Mr. John Peter Amewu, had explained earlier,  that the launch formed part of Ghana’s quest to domesticate the provisions in the African Mining Vision into its own country mining vision (CMV).

That, he said, was expected to complement the existing policies in the mining sector to ensure that the sector contributed optimally to the economy.

He said the Minerals Commission, the Chamber of Mines and the International Finance Corporation (IFC) were collaborating to ensure local content by creating a platform for local suppliers in the mining sector.

Mr. Amewu called on industry players to collaborate in carrying out their corporate social responsibilities.

For his part, the Coordinator of the AMDC, Mr. Kojo Busia, said it was increasingly clear that Ghana and Africa had not harnessed their mineral wealth for development, as their economies continued to rely on the extraction of raw materials.

Export of raw materials

The extraction and export of raw materials, he noted, represented the lowest segment of the value chain of mineral resources, as the value of processed products was typically worth 400 times more than the equivalent unit by weight of the raw materials needed to produce them.

“We see a lack of transformation very acutely in Ghana. While world-class mining supply and processing firms have emerged in South Africa, Chile and other mineral-producing countries, inputs for Ghana’s mining sector are mostly procured abroad and its minerals are processed abroad,” he said.

He said it was time to look at how mechanisms could be put in place to end what he called “this destructive cycle”.

The Deputy Minister of Trade and Industry, Mr. Robert Ahomka Lindsay, noted that while the initiative to have an NSDP for the mining sector was laudable, it was also necessary to have a comprehensive NSDP that cut across all sectors of the economy.

National suppliers

“What we need to do as a government is work with all of you to ensure that we have a national suppliers programme that caters for all the different key sectors, such as the mining, th  petrochemical and the fast-moving consumer goods industries,” he said and added that the NSDP for the mining sector could be worked on to produce a truly NSDP.

The Director of Policy Advisory Services at ACET, Dr. E. Brown, in his remarks, said for Ghana to build resilience to external shocks, it had to transform its economic structure by shifting from the revenue-first approach to deepening local content and value addition.

Original post at Graphic online

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