The persistent misuse of mineral royalties allocated to district assemblies is preventing mining communities from achieving the level of development expected from Ghana’s extractive sector, according to policy analyst and Co-Chair of the Ghana Extractive Industries Transparency Initiative (GHEITI), Dr. Emmanuel Steve Asare Manteaw.
Speaking on the sidelines of a Natural Resource Governance Institute (NRGI) Media and Civil Society Capacity Building Workshop on corruption risks in Ghana’s emerging lithium value chain, Dr. Manteaw said findings from successive GHEITI reports reveal that funds intended for local development are often diverted to recurrent expenditures with limited long-term value.
“The misuse of district shares of mineral royalties largely accounts for the reason we have not been able to transform our mining communities to the level we would have expected over the years.” - Dr. Manteaw
Royalties Spent on Recurrent Expenses
Ghana’s mining industry contributes substantial revenue through royalties paid by extractive companies, part of which is transferred to local authorities to support development in communities directly affected by mining activities.
However, Dr. Manteaw noted that many assemblies have failed to channel these resources into projects capable of creating sustainable economic and social impact.
“We find through our GHEITI reports that the bulk of the community share of mineral royalties is expended on recurrent items. In fact, there have been instances where these royalties have been spent on funeral donations.” - Dr. Manteaw
He further revealed that some district assemblies have used portions of the funds to hire chairs and canopies for public events, describing such expenditures as inappropriate given the temporary nature of mineral resources.
“There have been several instances where these revenues have been spent on hiring chairs and canopies for public events. When you treat revenues from a depleted and depletable resource like minerals in this manner, there is no way you can transform host communities.” - Dr. Manteaw
Call for Stronger Guidelines
Dr. Manteaw called for the introduction of clear spending guidelines to ensure mineral royalties are directed toward projects that leave a lasting legacy in mining communities.
According to him, a larger share of the funds should be invested in capital projects, infrastructure and development initiatives that benefit both present and future generations.
“We need guidelines that will require these revenues to be spent more on capital expenditures and development projects that leave a legacy for communities, both for current and future generations,” he said.
His remarks come amid growing attention on resource governance and transparency within Ghana’s extractive sector, particularly as the country prepares to develop its lithium industry.
Participants at the NRGI workshop emphasized that communities hosting mining operations must experience tangible improvements in living conditions if the country’s natural resource wealth is to translate into meaningful and inclusive development.
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