The expiration of the Damang mine’s lease on April 18, 2025, and the government’s refusal to renew the lease has raised significant concerns for both the workers and the local businesses in the surrounding communities that rely on the mine’s operations.
Mr. Abdul-Moomon Gbana, General Secretary of the Ghana Mineworkers’ Union, has stated in an interview with The High Street Journal, that the potential closure of the mine could lead to a domino effect on local businesses, including suppliers, shops, and service providers, which directly depend on the mining operations.
He expressed that the closure of such a large operation could bring economic hardship to many people who depend on the mine for their livelihoods, as the ripple effects would extend far beyond just the workers.
Economic Ripple Effect on Local Businesses
Mr. Gbana explained that mining is a significant and capital-intensive industry, and the investment made by companies like Gold Fields in their operations is substantial. If the mine is forced to shut down due to the lease expiration, the broader impact would be felt by businesses in the region.
He shared the following insights about the situation:
“Mining is a big business and it’s counter-intensive. So, when an investor invests huge sums of money into a mining business, the citizens for the investor to recoup that means some investment. So, if you have investment of such amounts of money, in millions, in some cases, billions of dollars, and the only reason why you cannot continue mining is because your lease has come to an end, you require government to extend it for you and government says no. That’s why it’s problematic.”
Gbana pointed out that local businesses depend on the mine for their income, and the closure would impact not just the direct employees but also the support businesses.
Loss of Livelihoods for Residents
The mine’s closure wouldn’t just affect the mineworkers, but it would disrupt the entire community. Gbana explained that many of the businesses in Damang are tied to the mining operations and that local residents are deeply interconnected with the mine’s activities.
“People who have built their livelihoods around the mine will be left without income. The entire community in Damang is intertwined with the mining industry. It’s not just the direct workers at the mine. It’s the entire village, including shop owners, drivers, and contractors who are dependent on this industry.”
The Need for Government Intervention
Mr. Gbana called on the government to consider the broader impact on the local economy and rescind its decison. He believes that while legal matters surrounding the mining lease must be considered, the government should prioritize the protection of local businesses and livelihoods.
“The government cannot afford to ignore the broader impacts on communities,” Gbana stated. “Yes, the law may be at the center of the lease renewal, but the government must also consider the long-term effects on local businesses.”
He suggested that the government should take proactive measures, such as offering support to affected businesses or even exploring alternative economic programs to help the local community adapt to the closure if the lease is not renewed.
Broader Implications for Ghana’s Economy
Gbana further addressed the potential national consequences of the Damang mine’s closure. He warned that such an event could have far-reaching implications not just for the local community but for Ghana’s mining industry as a whole.
“The Damang mine is not an isolated case,” he said. “Mining is central to Ghana’s economy, and when a mine like Damang closes, it doesn’t just hurt the local community, it impacts the country as a whole.”
He indicated that the investment community was closely watching the situation. “The investment community, both local and international, is paying attention to these developments,” Gbana pointed out. “If the government does not manage this properly, it could send a negative signal to other potential investors in Ghana’s mining sector.”
