Time for Govt to provide incentives to miners – GGDMA

…as 2017 Mid-Year Report highlights drop in gold production

With the worrying returns for Guyana’s gold sector being highlighted in the 2017 Mid-Year Report, the Guyana Gold and Diamond Miners Association (GGDMA) is calling for more support from the Government for small to medium-scale miners.

According to GGDMA Executive Member Colin Sparman, the Report indicates the need for action to boost production. Sparman noted that small to medium firms would not have the kind of capital large firms have to fall back on.
While he acknowledged that the Mid-Year Report had recorded an increase in production from small and medium-scale miners, the GGDMA Administrator stressed that it was still hard for them.
“The small and medium-scale miners need all the assistance they can get,” Sparman said in an interview with this publication. “The larger firms have (a larger) capital investment. But the small people keep on pushing.”
However, Sparman noted that there would be an upcoming meeting with Natural Resources Minister Raphael Trotman. He said that during that meeting, issues pertaining to concessions for miners were expected to be on the agenda.
For some time, miners have been raising issues such as the spike in taxes across the board implemented by the Government; in particular, the increase of the Tributors Tax from 10 to 20 per cent, Value Added Tax (VAT) on heavy-duty mining equipment and the two per cent Withholding Tax.
In addition, the Association had complained of not being able to benefit from the grant of duty-free concessions on mining equipment, vehicles and fuel, owing to the red tape experienced at the regulatory agencies involved.
Back in 2015, the GGDMA had signed agreements with the Guyana Energy Agency (GEA); Guyana Revenue Authority (GRA) and Guyana Geology and Mines Commission (GGMC). The agreement was signed at the Finance Ministry.
These agreements had included the granting of exemptions from custom duties on fuel and equipment for eligible miners. But with the exemptions’ initial lifespan of six months, miners complained bitterly that the time elapsed with many not benefiting.
As if the issues with the lost concessions were not enough, it was recently revealed that all miners, including small and medium-scale miners, will have to pay a hiked processing fee of $2500 per ounce of gold they declare to the Guyana Gold Board. The fee was previously just $1000 per ounce.
Had the GGDMA not intervened when a public notice announcing the hike first appeared in the daily newspapers, that fee would have been a whopping $4000 per ounce.
According to a missive from Avalon Jagnandan, the Administrative Manager at the GGDMA, the Association first became aware of the hike when a public notice appeared in the newspaper declaring that all miners and dealers selling gold to the Gold Board would have to pay the $4000 fee.
Mid-Year Report
According to the Mid-Year Report, the mining and quarrying sector contracted by four per cent, during the first half of 2017. Gold production, it noted, fell by 1.7 per cent to 317,096 ounces, in the first half of 2017, compared to the same period in 2016.
It is understood that of the total gold declared, 65.7 per cent came from small and medium-sized miners and dealers whose declarations were above projections, while Guyana’s two large gold companies, Guyana Goldfields and Troy Resources, were below projections.
Heavy rainfall and the switching to lower grade material by one of the producers, to facilitate remedial work at a higher yielding mine, were cited as factors that affected production for the large companies.
“Despite the slight decline in the first half of 2017, overall production is still expected to surpass its 2016 level, with the industry expected to grow by 1.7 per cent in 2017,” the Report nevertheless projected.