Ghana and Barari Lithium Deal Hits Roadblock

The Institute of Economic Affairs (IEA) is calling on Parliament to suspend the ratification of the Revised Lithium Agreement between Ghana and Barari until a thorough review is conducted.

The economic and policy think tank argues that the current agreement mirrors colonial-era resource extraction deals and fails to align with international frameworks Ghana has already endorsed. This comes as the agreement is currently before the House for ratification.

According to the IEA, the agreement does not adequately prioritize Ghana’s benefit in the exploitation of its lithium resources. The Institute cited examples from countries like Norway, Chile, and Botswana, as well as nations in the Middle East, which have successfully leveraged their natural resources for national development.

The IEA’s statement highlighted resolutions from the United Nations General Assembly – Resolution 1803 (1962) and Resolution 3281 (1974) – and the African Charter on Human and Peoples Rights, all of which emphasize the right of resource-rich nations to control and benefit from their own wealth. “Article 21(1) of the African Charter on Human and Peoples Rights stipulates that under no circumstances shall a people be deprived of their right to exploit their wealth and natural resources in their exclusive interest,” the IEA stated.

Furthermore, Article 21(5) of the Charter mandates that state parties actively work to eliminate foreign economic exploitation, ensuring their citizens fully benefit from natural resource revenues. The IEA is advocating for revisions to the lithium agreement to ensure greater state and local ownership and control, in line with these international obligations.

The Institute has also urged the government to establish a State Owned Ghana Lithium Company (GLC). This GLC would be responsible for overseeing the entire lithium value chain, from raw material extraction to battery production within Ghana.

In addition to the GLC, the IEA recommends a competitive bidding process to select a consortium of Ghanaian contract mining firms – including companies like African Mining Services, BCM Ghana Limited, Engineers and Planners, Quantum LC Limited, Rocksure International, and Underground Mining Alliance – to manage the actual mining operations under a service contract to Ghana.

The IEA also stressed the need to expedite the ongoing review of relevant legislation and policies to facilitate the implementation of these recommendations. “There is also the need to speed up the ongoing legislative and policy review process to fast track operationalisation of the above recommendations,” it added.

The IEA believes that now is the opportune moment for Ghana to assert ownership over its lithium wealth and utilize it as a catalyst for industrial transformation. “Our call is simple: Ghana must take ownership of its lithium, contract the private sector to mine on its behalf, and develop the entire lithium value chain in order to derive maximum benefits from the lithium discovery,” the Institute concluded.

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