By Leo Nelson
Bright Simons, the Vice President of IMANI Africa and a renowned policy analyst, has raised a red flag regarding the government’s strategy for fostering local ownership within Ghana’s extractive sector, arguing that the current model sets indigenous companies up for failure.
He contends that rather than nurturing national champions, the state is handing over technically depleted or operationally distressed assets to local players a move he describes as offering “poison chalices” to Ghanaian investors.
According to Bright Simons , this trend prioritizes short-term financial engineering over the long-term strategic development of the nation’s mineral wealth.
“In a way, we are giving poison chalices to certain companies that we claim are national champions. We are setting them up to fail by giving them very complex mines with a lot of difficulty that even international investors couldn’t handle. We are handing these over to our people because existing mines are already producing and can be used to milk the assets.”
Bright Simons observes that the government appears focused on mines that have already been “pre-built” and are entering highly complex technical phases.
By the time these assets are transitioned to local ownership, they often carry a burden of difficulty that even well-resourced international investors have struggled to manage.
This approach, he suggests, is driven by the fact that these mines are already producing, making them attractive for raising loans rather than for genuine industrial growth.
The Crisis of Distressed Asset Transfers
The transition of the Golden Star Bogoso Prestea mine to Blue Gold serves as a primary example of the “difficult place” local entities find themselves in.
When international investors “literally couldn’t handle it and had to run away,” the asset was left to indigenous hands that are now “caught” with the same systemic issues.
This pattern suggests that local companies are being positioned as “last resort” owners for mines that have reached a point of diminishing returns or extreme technical volatility.
By pushing local ownership at this specific juncture, the state essentially transfers the highest risk to those with the least access to global capital markets.
Instead of being supported, these local companies are burdened with legacy environmental liabilities and operational inefficiencies that were established under previous regimes.
Strategic De-risking of Greenfield Sites
To rectify this, Bright Simons proposes a shift in focus toward “greenfield sites” in regions such as the Upper West and Upper East, where gold deposits are known to exist but remain underdeveloped.
He argues that sovereign wealth funds, including the Minerals Income Investment Fund (MIIF), should deploy resources to “de-risk” these areas early in the exploration cycle.
By conducting the necessary geological and feasibility groundwork, the state can create a stable entry point for Ghanaian owners to join the project from the ground up.
A “strategic development of the resource” would involve using national funds to move projects from the speculative phase to the proven reserve phase.
This would allow indigenous firms to grow alongside the asset’s lifecycle, gaining technical expertise during the less volatile early stages of construction and production.
Currently, the absence of this state-led de-risking means that local companies are sidelined during the lucrative “easy” years of a mine’s life, only to be invited in when the “poison chalice” is the only thing left on the table.
Impact on the National Extractive Narrative
The current approach risks damaging the reputation of indigenous mining firms, labeling them as incapable when, in reality, they have been handed impossible mandates.
If these national champions continue to fail because they are assigned the most complex mines without the requisite support, it reinforces a narrative that only foreign entities can manage large-scale extractives.
This undermines the very concept of “Local Content” that the Ghanaian government claims to champion.
Furthermore, the practice of using existing, producing assets primarily as collateral for loans rather than reinvesting in new discoveries threatens the sustainability of the sector.
When the goal is to “milk the assets” for immediate fiscal relief, the long-term health of the mine is often sacrificed.
For Ghana to truly benefit from its mineral wealth, the policy framework must move away from opportunistic takeovers of declining mines and toward a robust, state-supported pipeline of new projects where local ownership is woven into the fabric of the mine from the very first drill hole.