Policy impacts on Ghana's extractive sector: The implicative dominance of gold and the future of oil

Abstract

As Ghana continues to develop into one of West Africa's economic leaders, the extractive resource sector will play a critical role in the country's industrialization in a post-industrial world, especially through mining and oil. As of 2020, Ghana's extractive sector generates for 17 percent of government revenue and 67 percent of exports. Gold accounts for 93 percent of the country's mining revenue, while the mining industry accounts for 10 percent. Essentially, the mineral sector is valuable to Ghana, yet it continues to lack the attention it requires in policy development and implementation. In light of this, this paper aims to highlight the potential positive outcomes of leveraging the extractive sector in Ghana as a tool for sustainable development and inclusive economic growth. Utilizing policy reviews, the paper analyses the implementation of laws, capacity limitations, and policy gaps in Ghana, and suggests steps toward addressing them. The paper further examines Ghana's fiscal regime, diversification of economy, linkages between sectors and inclusive economic transformation. The paper concludes that the extractives industry – in particular the oil sector – can, through effective policy implementation and revenue management, contribute to economic diversity and socioeconomic development.