Modes of Governance and Revenue Flows in African Mining

269 Pages·2013·2.493 MB·English

by  Bonnie K. Campbell (eds.)

International Political Economy Series
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Titles include:
Bonnie K. Campbell (e ditor)
MODES OF GOVERNANCE AND REVENUE FLOWS IN AFRICAN MINING
Gopinath Pillai (e ditor )
THE POLITICAL ECONOMY OF SOUTH ASIAN DIASPORA
Patterns of Socio-Economic Influence
Rachel K. Brickner (e ditor)
MIGRATION, GLOBALIZATION AND THE STATE
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CLIMATE CHANGE AND GLOBAL POLICY REGIMES
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Mark Findlay
CONTEMPORARY CHALLENGES IN REGULATING GLOBAL CRISES
Helen Hawthorne
LEAST DEVELOPED COUNTRIES AND THE WTO
Special Treatment in Trade
Nir Kshetri
CYBERCRIME AND CYBERSECURITY IN THE GLOBAL SOUTH
Kristian Stokke and Olle Törnquist (e ditors )
DEMOCRATIZATION IN THE GLOBAL SOUTH
The Importance of Transformative Politics
Jeffrey D. Wilson
GOVERNING GLOBAL PRODUCTION
Resource Networks in the Asia-Pacific Steel Industry
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Modes of Governance and
Revenue Flows in African
Mining
Edited by
Bonnie K. Campbell
Professor of Political Economy, Department of Political Science,
University of Quebec in Montreal, Canada
Editorial matter, selection, introduction and conclusion © Bonnie K. Campbell 2013
Remaining chapters © Contributors 2013
Softcover reprint of the hardcover 1st edition 2013 978-1-137-34596-7
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First published 2013 by
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Contents
List of Illustrations v i
Acknowledgements v iii
Notes on Contributors i x
List of Abbreviations x ii
Introduction 1
Bonnie K. Campbell
1 An Overview of Revenue Flows from the Mining Sector: Impacts,
Debates and Policy Recommendations 16
John Jacobs
2 Regulatory Framework Review and Mining Regime Reform in
Mali: Degrees of Rupture and Continuity 47
Saël Gagné-Ouellet
3 Constraints to Maximization of Net National Retained Earnings
from the Mining Sector: Challenges for National Economic
Development and Poverty Reduction in Sub Saharan Africa
as Illustrated by Ghana 101
Thomas M. Akabzaa
4 Artisanal Mining in Ghana: Institutional Arrangements,
Resource Flows and Poverty Alleviation 138
Gavin Hilson and Godfried Okoh
5 Tracing Revenue Flows, Governance and the Challenges
of Poverty Reduction in the Democratic Republic
of Congo’s Artisanal Mining Sector 164
Didier de Failly S.J., Zacharie Bulakali Ntakobajira and
Lucien Bahimba Shonja
Conclusion 2 23
Bonnie K. Campbell
Index 2 39
v
List of Illustrations
Tables
I .1 I llicit flows and the least developed countries. The top
20 countries characterized by the most important
illicit capital flows 2
2.1 F iscal, customs, financial and economic regimes of
the 1991 Mining Code 6 6
2.2 F iscal, customs, financial and economic regimes of the 1991
and 1999 Mining Codes 6 9
2.3 G old production in Mali (in tons) 7 3
2.4 V alue of Mali’s gold production (in billions of CFAF) 7 4
2.5 S ummary of the importance of gold in the national
economy of Mali (2004–2008) 7 6
2.6 T he five mineral or fossil substance groups subject to
the mining regime under Article 8 of the 2012 Mining Code 83
2.7 L egislative provisions regulating artisanal mining activities
in the 2012 and 1999 Mining Codes 8 5
2.8 F iscal, customs, financial and economic regimes of the 1991,
1999 and 2012 Mining Codes 8 9
3.1 P roposed template for retained earnings for individual projects 115
3.2 L ist of defined rents and taxes provided by Minerals and
Mining Act, Act 703, 2006 1 17
3.3 L ist of development partner interventions in the mining
sector in Ghana from 1983 –2012 1 19
3.4 F inancial commitment to individual mines by IFIs 1 25
3.5 D istribution of mineral royalty between central and local
government 1 28
3.6 D istribution of 10 per cent royalty at the local level 1 28
3.7 C oncession ground rent amount payable (2004–2008) 1 29
4.1 W aived import duties of AngloGold Ashanti (2008–2010) 1 54
4.2 R ange of income of ASM operators in Obuasi 1 59
5.1 C omparison between industrial and artisanal production 1 71
5.2 M ineral export procedures 177
5.3 R ecommended measures for a rural development programme
on artisanal mining 2 08
Figures
1.1 M ali, gold sector indicators (2004–2007) 2 0
1.2 M inerals, ores and metals prices 2 7
vi
List of Illustrations vii
2.1 G old and cotton exports in Mali between 2004 and
2008 (in billions of CFAF) 7 5
3.1 F oreign direct investment to the mining sector (1983–2009) 1 10
3.2 A nnual FDI flows compared with annual mineral sales
and retentions (USD millions for 1990–2009) 1 16
4.1 M ap of Ghana showing Obuasi 1 52
5.1 D eposit and its eroded part 1 70
5.2 L arge geological faults near Southern Kivu 1 72
Acknowledgements
This volume is the result of a multiyear research programme (2007–2011)
entitled ‘The renewal of the modes of governance in the extractive sector and
poverty reduction in Africa’ which was made possible thanks to the financial
support of the International Development Research Centre (IDRC), Ottawa.
We wish to express our sincere gratitude to the International Development
Research Centre for making this programme possible.
The contributions to this book were produced by a collective group of
researchers under the direction of Bonnie K. Campbell who is a professor of
political economy at the Department of Political Science, Faculty of Political
Science and Law, at University of Quebec in Montreal (UQAM), and who
heads up the Groupe de recherche sur les activités minières en Afrique (GRAMA)
which in turn is a component of the C entre interdisciplinaire de recherche
en développement international et société (CIRDIS) at UQAM. The contribu-
tors include John Jacobs, a doctoral candidate in economics at Carleton
University, Saël Gagné-Ouellet, a political scientist and also a member of
GRAMA at UQAM, Dr. Thomas M. Akabzaa, a professor of Geology at the
University of Ghana, Legon and currently Chief Director of the Ministry of
Energy and Petroleum, Ghana, Dr. Gavin Hilson a professor at the Faculty of
Business, Economics and Law, University of Surrey, Guildford in the United
Kingdom, Dr. Godfried Okoh who has recently completed his doctoral degree
at the School of Agriculture, Policy and Development, University of Reading,
United Kingdom, and Didier de Failly S.J., Zacharie Bulakali Ntakobajira and
Lucien Bahimba Shonja, all of the B ureau d’Études Scientifiques et Techniques
(BEST), Bukavu, Southern Kivu, Democratic Republic of the Congo.
This book would not have been possible without the kind assistance of
numerous people who helped in many different ways such as obtaining
the most recent copies of mining regulations and generously contributing
comments and references.
We wish to thank Damien Hatcher for his excellent professional support in
the translation of the chapters on Mali and the DRC as well Élodie Rousselle,
Myriam Laforce and Etienne Roy Grégoire of CIRDIS for their invaluable
assistance in the preparation of this manuscript and in particular Élodie,
Andréanne Martel, Charles Saliba-Couture for their meticulous work in
ensuring the finalization, editing and indexing of the volume.
A very special word of appreciation goes also to Gisèle Morin-Labatut of
the IDRC and her successor Loredana Marchetti for their confidence and
support over the years for the work which we have carried out. Without the
support of the IDRC, the vital insights gained from our African contributors
would not have been possible and neither would have been this volume.
viii
Notes on Contributors
Thomas M. Akabzaa is Associate Professor in Geology in the Department
of Earth Science at the University of Ghana. He holds bachelor’s and PhD
degrees in Geology with Physics and Mining Environmental Management,
respectively, from the University of Ghana and a master’s degree in Mining
Engineering from McGill University, Canada. He was Head of the Department
of Earth Science, University of Ghana, from 2008 to 2010. His academic and
research interests are in the areas of mining sector investment appraisal,
mining and the environment, extractive industries and sustainable develop-
ment, petroleum systems, water quality and vulnerability studies, global envi-
ronmental changes and economic development and global initiatives in the
extractive sector. He has led numerous research and training programmes in
several African countries including the pre-validation and international vali-
dation of Ghana’s Extractive Industries Transparency Initiative (EITI) process,
training programmes for the Sierra Leonean Multi-stakeholder Group on
EITI, ECOWAS, surveys on extractive resource policies, legislation and taxa-
tion systems in several African countries and their implications for national
development, gender implications of Ghana’s oil policy, Course Convener for
the Revenue Watch Summer School on Oil and Gas at the Ghana Institute
of Management and Public Administration (GIMPA), among others. He has
over forty publications to his credit. He is currently the Chief Director of the
Ministry of Energy and Petroleum of the Government of Ghana.
Bonnie K. C ampbell is Professor of Political Economy at the Department
of Political Science at the University of Quebec in Montreal where she is
Director of the C entre interdisciplinaire de recherche en développement
international et société (CIRDIS) and also Director of the Research Group on
Mining Activities in Africa (G roupe de recherche sur les activités minières
en Afrique ). She was a member of the Advisory Group named by the federal
government for the National Roundtables on Corporate Social Responsibility
(CSR) and the Canadian Extractive Sector in Developing Countries (2006–
2007) and from 2007 to 2011 was a member of the International Study Group
on Africa’s Mineral Regimes of the United Nations Economic Commission
for Africa (UNECA). She has written extensively on issues related to interna-
tional development, development assistance, governance and mining and
is the author of many journal articles, and author, editor or co-editor of
thirteen volumes including Restructuring in Global Aluminium (co-edited with
Magnus Ericsson, 1996), R egulating Mining in Africa: For Whose Benefit? (2004),
Qu’allons-nous faire des pauvres? Réformes institutionnelles et espaces politiques ou
les pièges de la gouvernance pour les pauvres (2005), M ining in Africa: Regulation
ix