Ghana’s $10.8bn Small-Scale Gold Boom Leaves State With Little to Show

 

Ghana’s small-scale gold mining industry generated an estimated US$10.8 billion in gold exports in 2025, accounting for more than half of the country’s total gold exports, yet the government collected virtually no mineral royalties from the sector, exposing a major hole in the country’s fiscal system.

The finding by the Institute for Fiscal Studies (IFS) puts a sharp question mark over the fiscal benefits Ghana is deriving from one of its fastest-growing economic activities.

In its analysis of the government’s 2026 mid-year budget review, the economic policy think tank said the extraordinary growth in small-scale gold production and exports has not translated into a corresponding increase in government revenue because the sector remains largely outside effective revenue mobilisation mechanisms.

IFS Executive Director and economist Dr. Said Boakye said the government urgently needs to develop a dedicated strategy to capture a fair share of the wealth being generated from the country’s mineral resources.

The warning comes as the Domestic Gold Purchase Programme (DGPP) and the establishment of GoldBod have brought the scale of small-scale gold production into much clearer view.

$10.8bn in exports, but almost no royalties

The numbers reveal the size of the disconnect.

Ghana’s total gold exports surged 103.3% in 2025, rising from US$10.31 billion to US$20.98 billion.

Small-scale mining accounted for approximately US$10.80 billion, or 51.5%, of that total.

Yet mineral royalties, which depend overwhelmingly on gold production, rose by only 21.1%, from US$364.87 million in 2024 to US$441.82 million in 2025.

The IFS said information published by the Minerals Income Investment Fund (MIIF) indicates that the royalties collected in 2025 came entirely from the large-scale mining sector.

That means the sector responsible for more than half of Ghana’s gold exports generated little, if any, direct mineral royalty revenue for the state under the existing system.

For IFS, that is not simply a revenue collection problem. It is a structural weakness in Ghana’s mining fiscal regime.

“Allowing such a situation to persist means the government is not interested in ensuring that growth in gold export generates anything close to commensurate growth in fiscal revenue from the sector,” the institute said.

The fiscal gap is bigger than royalties

The problem, according to the IFS analysis, extends beyond royalties.

The institute said its enquiries indicate that other major mining revenue instruments, including corporate income tax, also generate little to no revenue from the small-scale mining sector.

That creates an unusual situation in which the value of gold flowing out of the country can rise sharply without producing a comparable increase in tax receipts.

In effect, Ghana is seeing the commercial value of its gold resources expand faster than the fiscal value captured by the state.

This is becoming increasingly difficult to ignore as the formalisation of gold purchases through GoldBod provides greater visibility into the scale of production and exports from the small-scale sector.

Government urged to build a revenue strategy

The IFS is calling for the government to move beyond simply monitoring production and exports and develop a deliberate fiscal strategy for the sector.

At the centre of its recommendation is a basic principle: Ghana’s mineral resources belong to the people and are held by the state in trust. The state, therefore, should receive a fair share of the economic value created when those resources are extracted.

The institute argues that the rapid expansion of small-scale mining makes this even more urgent.

Rather than allowing the sector to grow largely outside the tax net, government should design mechanisms that link the value of gold produced and exported to appropriate fiscal contributions.

Such a strategy would need to balance revenue mobilisation with the need to keep legitimate small-scale mining commercially viable, while also reducing incentives for informal and illegal operators to remain outside the formal system.

A bigger question for GoldBod

The findings also raise broader questions about how Ghana’s new gold purchasing architecture can be used to strengthen public finances.

GoldBod has effectively created greater visibility around the country’s small-scale gold trade. That visibility could give government a stronger basis for designing a fiscal framework that captures more value without relying entirely on conventional mining royalty collection systems.

The challenge is to ensure that the formalisation of gold trading does not stop at improving traceability, foreign exchange management and gold exports.

It must also translate into domestic fiscal value.

For Ghana, the stakes are substantial. If small-scale miners can account for more than half of gold exports but contribute little to mineral royalties and corporate income tax, the country risks creating a growing mining economy in which the state captures only a fraction of the wealth generated from publicly owned resources.

From gold boom to revenue boom

The IFS analysis therefore exposes a paradox at the heart of Ghana’s gold economy.

The country is exporting more gold than ever, and the small-scale sector is emerging as a dominant force in that trade. But the surge in exports has not produced a proportionate increase in government revenue.

That gap represents both a fiscal weakness and an opportunity.

With Ghana under continued pressure to raise domestic revenue and reduce dependence on borrowing, the government cannot afford to leave billions of dollars in mineral production largely disconnected from the tax system.

The policy challenge is no longer whether small-scale mining is economically significant.

The numbers have answered that question.

The challenge is how to turn that economic significance into a fair and sustainable stream of public revenue without driving legitimate operators back into informality.

For the IFS, the starting point is clear: Ghana needs a deliberate revenue mobilisation strategy for small-scale gold mining, rather than allowing the sector’s rapid expansion to continue without a corresponding fiscal return.