PMMC saddled with GH₵65.5m legacy debt

A legacy debt amounting to GH₵65.5 million is impeding the operation and growth of the Precious Minerals Marketing Company (PMMC).
 
According to the Managing Director (MD) of PMMC, Nana Kwasi Awuah, “the debts, incurred as a result of failure to service loans secured from four banks in the country, had become an albatross on the operations of the company,” was stifling progress and making it difficult to attract the needed investment. 
 
Originally GH₵30.6 million as at January 2017, he said, accumulation of interests over the years had catapulted the debts to the current amount.
 
Speaking yesterday in Accra when the Deputy Minister of Lands and Natural Resources, George Mireku Duker, visited the company, the MD noted that the company had since 2017 paid GH₵15.5 million of the debt.
 
Last year, he stated, that GH₵12 million was charged as finance cost on the legacy debt.
 
Mr Awuah noted that the company’s revenue was badly hit by the three per cent withholding tax on unprocessed gold as people circumvented the legal means to smuggle the product to other countries.
He commended the government for slashing it to 1.5 per cent, which had resulted in a huge increase in assay fees.
“The reduction of the withholding tax on unprocessed gold to 1.5 from three per cent has helped the business to pickup.
“Last year December, when the three per cent was in force, we only recorded GH₵59,890 from assay fees. In January, when the 1.5 per cent was implemented, we received more than GH₵312,000 from assay fees,” he added.
He appealed to the government to aid the PMMC in servicing the legacy debt and enable it progress.
 
Earlier in a presentation, Mohammed Abubakar, Acting Director of Finance, PMMC, said the company was in discussion with the Ghana Revenue Authority (GRA) to address an audit of PMMC’s financial statement from 2014 to 2019, which found that the company was liable for an amount of GH₵337,902 for direct taxes and GH₵8.4 million for indirect taxes.
 
He noted that the bulk of the liability related to gold export service charges in 2014 and 2015 and assay service charges to the large scale mines.
 
 In response, Mr Duker said the ministry would engage its counterpart at FinanceMinistry to find a solution to address the legacy debt.
 
He stated that the government was counting on the company to increase Ghana’s gold export revenues, and asked the management to establish channels with small-scale miners to purchase gold produced to curb sales through the black market.
 
The Deputy Minister tasked PMMC to engage with the public and sensitise them on activities of their operations.
 
He urged them to collaborate with stakeholders in the mining communities and set up offices in the mining companies to make them accessible to the firms. 

BY CLAUDE NYARKO ADAMS

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