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Agyapa Stillborn

President Akufo-Addo, on November 2, 2020, directed Finance Minister, Ken Ofori-Atta to go back to Parliament on the Agyapa Royalties deal for further assessment.

A source from the Office of the President was quoted as saying the President wanted further scrutiny from the legislature, particularly the aspects of the deal pertaining to the relationship, investment and allocation of the agreement.
The President also advised the Finance Minister to take into consideration all the feedback Mr. Ofori-Atta had received from stakeholder engagements with civil society organisations, faith-based organisations and other interest groups.

Main Arrangement

The Government decided to consolidate all the country’s potential mineral income in a fund and to be largely managed by a special purpose vehicle (SPV) called Agyapa Royalties, but it triggered heated debate and controversies over the arrangement.

The plan was to do it through the establishment of Agyapa Minerals Limited which was 100% owned by Minerals Income Investment Fund (MIIF) established by Act 978, of 2018 which is also 100% owned by the Government.
Amidu Assessment
The Office of the Special Prosecutor (OSP) announced on November 2, 2020 that the corruption risk assessment on the controversial Agyapa Royalties deal had been completed.
A statement signed by the then Special Prosecutor (SP), Martin Amidu, said his office had communicated the conclusions and observations on the deal to President Akufo-Addo and Mr. Ofori-Atta some “two weeks ago.”
The statement noted that this was done as a matter of courtesy before making the public announcement, adding “the analysis of the risk of corruption and anti-corruption assessment was completed and signed by the SP on October 15, 2020.”
“Two weeks is more than too long for this office to continue withholding the announcement of the completion of its 64-page report to the public. It is important that this office has the freedom to discharge its anti-corruption mandate and keep the public informed.”

“I have, therefore, decided to bring the facts of the conclusion of the anti-corruption assessment of the Agyapa Royalties Transactions by this office to the attention of the public and to avoid the continued speculations on this matter,” the statement intimated.

Stakeholder Consultation
On September 9, 2020 the Ministry of Finance held separate virtual meetings with the Social Partnership Council (SPC) and the leadership of faith-based organisations (FBOs) as part of stakeholder engagement and consultation to deepen understanding on the Agyapa Minerals Royalty deal.
It followed concerns raised by some civil society organisations (CSOs) for the government to place the citizen at the centre of policy making considerations, not just as a target, but also as an agent.
The SPC was made up of the labour unions, Ghana Employers Association and government, represented by the Ministries of Finance and Employment and Labour Relations, while the FBOs include the Catholic Bishops Conference, Christian Council of Ghana, Ghana Pentecostal and Charismatic Council, National Associations of Charismatic and Christian Churches and the Ghana Charismatic Bishops Conference.

A statement signed and released by the ministry’s Public Relations Unit later said the issues discussed included the nature and benefits of the transaction, ownership, transparency and domain of registration.
Others, the statement added, were initial valuation, future prospects as well as the need “to continue to engage with all stakeholders to get their buy-in and support.”

Finance Minister

Mr. Ofori-Atta explained the need for Ghana to take advantage of the current time because of the high gold prices in spite of the prevailing tighter financing conditions due to the Covid-19 pandemic.
According to him, there are weaknesses in the current framework for managing the country’s mineral royalties which does not allow for the targeted use of and accounting for mineral royalties.
He said that it was expected to be listed on the London and Ghana Stock exchanges, where the government planned to sell up to 49% shares via an initial public offer (IPO).

He had said the shares would be dually listed on the London and Ghana Stock exchanges, and explained that registering the entity in Jersey, the Channel Islands, was very well intentioned, given that a number of international companies, including Tullow and Vodafone that were listed on the London Stock Exchange were all registered in Jersey.
The Finance Minister again stated that a listing on the London Stock Exchange would ensure that Agyapa Royalty would be required to abide by the highest standards when it comes to corporate governance and reporting requirements among others.

Income From Mining
According to the Ghana Revenue Authority (GRA), fiscal revenue contributions of the mining and quarrying sector in 2018 amounted to GHȼ 2,362,194,425, an increase of 9.3 % from the previous year’s revenue contribution from the sector.
This revenue was derived from employee income tax (Pay-As You-Earn), corporate income tax, royalty, others (self-employed).
Out of the amount, GHȼ 705,262,160 was paid as royalty by mining companies, which are by law required to pay mineral royalties (between 3% and 6% of the value of gold they mine) to the country. It is paid to the GRA which then pays into the consolidated fund in fulfilment to Article 176(1) of the 1992.

Capital Portfolio

Ghana often obtains funding to execute its development mandate from debt capital markets, subject to terms and conditions, including the obligation to repay the principal borrowed with interest thereon.
The Treasury & Debt Management Division of the Ministry of Finance, in April 2020 said the public debt stock increased from GH¢216.7 billion (US$39.12 billion) at end-December 2019, to GH¢234.9 billion (US$43.17 billion) at end-March 2020 which is 59.3% of GDP.
According to the Division, external debt accounted for GH¢124.79 billion (US$22.94 billion), or 31.35 percent of GDP, whereas domestic debt accounted for GH¢111.26 billion (US$20.45 billion), or 27.95 percent of GDP.
The Government, seeking to diversify the country’s capital portfolio and stop increasing the debt stock, by obtaining long-term capital without repayment obligations, through equity capital market transactions, developed for raising equity capital that involves leveraging Ghana’s future gold receivables.

The country is entitled to and receives annual royalties from gold mine operators. Ghana’s revenues from gold mineral royalties are highly variable and controlled mainly by external factors, according to the Ministry of Finance.
But it indicated, however, that these revenues, notwithstanding, are substantial, with the nation receiving approximately US$120 million in royalties from gold mine operators in 2017.

Agyapa As SPV

The transaction, therefore, requires the country to establish and authorize the Minerals Income Investment Fund (MIIF) to manage its equity interests in mining companies, create and hold equity interests in special purpose vehicles (SPVs) (which may operate as regular, commercial companies) in any jurisdiction, assign any and/or all of the country’s mineral equity interests to an SPV in furtherance of the Fund’s objectives, and procure the listing of an SPV on any reputable stock exchange.
The Minerals Income Investment Fund Act, 2018 (Act 978) was passed in 2018 and has since been amended by Parliament to enable SPVs created under the Act to operate as regular commercial companies on sound corporate governance principles.

Section 41 of the MIIF Act enables the Fund to, subject to parliamentary ratification; enter into an allocation agreement with an SPV to assign the Republic’s mineral equity interests to that SPV.

Section 40 of the MIIF Act also empowers the Minister of Finance to, subject to parliamentary ratification, enter into a stability agreement with the Fund and an SPV to grant fiscal and legislative stability to that SPV.
In accordance with the provisions of the Act 978, the President appointed persons to the governing board of the Fund and authorized them to operationalize the objectives of the MIIF Act. Pursuant to this, the Fund incorporated Agyapa Royalties Limited under the laws of the Bailiwick of Jersey. The Fund is the sole shareholder of Agyapa.
Agyapa was registered in Ghana as an external company and also incorporated ARG Royalties Ghana Limited as its wholly owned subsidiary in Ghana.
Pursuant to the transaction, the Fund will (under the Investment Agreement) assign the Allocated Mineral Royalties to ARG, which will, upon receipt, upstream the Allocated Mineral Royalties to Agyapa.
Agyapa Fight

The debate on whether the Government is right to consolidate all the country’s potential mineral income in one fund and largely managed by a special purpose vehicle (SPV) called Agyapa Royalties intensified in the run up to it being listed and the general election.

Despite explanation that Agyapa Royalties was 100% owned by Minerals Income Investment Fund (MIIF), which is also 100% owned by government, and that there were no “hidden beneficiaries”, opponents of the deal were adamant in their opposition that it would serve the interest of the country.

The public discourse was like a fight with a group calling itself an Alliance of Civil Society Organisations (CSOs) working on extractives, anti-corruption and good governance, ‘fired’ from all cylinders and claimed that some elements in the government had ‘huge’ interest in the whole deal but could not name those with the ‘interests’.

Scouring the margins of science to find questions, the CSOs claimed that there had not been ‘full disclosure’ on those behind the SPV (Agyapa Royalties), despite the deal going through Parliament before MIIF was empowered to commence the deal on behalf of the government.

Raising Questions

Dr. Steve Manteaw, who spoke for the Alliance of CSOs, insisted that there was lack of transparency in the whole deal and that “rather raises moral and governance questions” adding, “the assumption that once everything goes through Parliament it is above board and represents the interest of all Ghanaians is deceptive and turns democracy on its head. It makes the elected the only relevant stakeholders in policymaking.”

Like the culture of critique which is based on the belief that opposition leads to truth as once said by Deborah Tannen, a member of IMANI-Africa, Bright Simmons also joined the bandwagon to criticize the deal, claiming the whole deal was without what he called “effective term” and added that “the fact that the term is not in there definitely is beyond dispute and debate.”

“In the final agreement, the beneficiary, in this case, Agyapa still has the capability to a successor agreement and renewal leases to be considered as part of the original term,” he said on Joy FM’s news analysis programme, News File.

Too Late

Abdul Malik Kweku Baako Jnr, who was also on Joy FM’s Newsfile, said it was too late for the CSOs to be demanding to be part of the arrangement when they had all the time to do so during the cooking stage and said their current stance is against the spirit of activism.

“To be honest with you where we have reached, and I am a realist, Parliament has approved the agreement; I’m not too sure that the call for the suspension of this deal is realistic or sustainable. It is not going to happen. It comes with a lot of integrity challenges,” he said.

He added, “I am an advocate of CSOs activism; civil society activism implies that you would be on alert; that you would be searching and researching as to what is happening; the budget is a public record and it’s stated there that the government has an intention to do something like that . . . I have no problem when they are calling for a consultation. My problem is when that call was made.”

Ideal Situation

He said that “it would have been ideal if the government had engaged CSOs, but the CSOs must always be on the alert. The activism requires that they are always monitoring what is happening in Parliament; they ought to …but to wait to this stage and then to make calls for reversal or suspension, I think it is an unsustainable thing.”

Ken’s Take

Finance Minister Ken Ofori-Atta kept insisting that there were no hidden shareholders, saying, “It is a clean transaction as far as I know and we’re just looking for ways to maximise value and to play in the game that our multinationals play and now we have the skill set to be able to do that.”

He said, “As far as I know, it (Agyapa Royalties deal) has been as transparent as you can see it; it’s gone through Parliament on many levels, gone through Cabinet on many levels and there’s truly nothing to hide except creating something new that may be uncomfortable but it is something new that is going to stand us in great order.”

Mortgage Today

“There are those who say we should be careful not to mortgage or sell today, the gold in the ground for future generations. First of all, this is not the case,” he said and explained, “But I have two questions for those who raise these concerns. If it is okay for the foreign investor who holds the concession to sell what is in the ground upfront, then why not us? But more importantly, why is it okay to borrow today for the future and not good to use our resources to leverage assets for tomorrow.”

“We must be creative to expand our sources of raising income to support our development. We are in a hurry to catch up. Every year, every generation we wait, we keep people and families stuck in the abyss of poverty and suffering.”

Stock Exchange

The minister also said that “we are excited about the listing of Agyapa in London by the end of the year. It creates the first royalty company of that nature in Africa” adding, “It is really sad that for a country that has been mining gold since the 15th century with the Portuguese, we still don’t have any international listing company either in gold or even cocoa. This must come to an end and we believe this is a strong statement to register Ghana’s presence going forward.”

Mr. Ofori-Atta further said that it was part of the ‘Ghana Beyond Aid’ agenda, insisting, “Five hundred times more gold is traded every day than is mined; much of this happens in countries that have virtually no gold to themselves. President Akufo-Addo says to achieve ‘Ghana Beyond Aid’, we must add considerable value to what we produce and trade.”


Agyapa is supposed to be forward-thinking. It is a pioneering template for Africa on how to achieve value add-on exports. It is the intention of Agyapa Royalties Limited to be an African royalty company and to leverage Ghana’s position as the leading gold producer in Africa to build an African royalty portfolio.

But the deal remains a stillborn in these simplified extremes of argument for and against Agyapa amidst disinformation that planted something ‘evil’ in people’s mind.


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