PMMC Struggling With GHC 65.5 Million Debt – Calls For Government Relief

The Precious Mineral Marketing Company (PMMC) is saddled with an inherited debt of GH?65.5 million, with interest compounded on the debt each month.

This made it difficult for the company to operate efficiently and declare dividends to the government.

Although the PMMC itself has put in place internal measures to repay the debts, management has still appealed through its Sector Minister for government relief to enable it to pay the debt.

PMMC Managing Director Nana Akwasi Awuah revealed this in an interview with Graphic Business.

He said that while the company has been able to carry out its mandate effectively over the years, some challenges have left it with huge debts.

“Without the debt situation, the business would have been very profitable, paying huge dividends to the government. That is why we have continued to appeal to the government for help and we are aware that works are ongoing on this.

“The Department of Finance continues to discuss with us the best arrangement to deal with this legacy debt,” he said.

Inherited debt

Nana Akwasi Awuah noted that the debt was an inherited legacy in 2017.

“At the time it was inherited it was around GH30 million, with a dollar component of around $4 million. For the dollar component, it has been fully repaid, but the cedi component continues to grow due to interest. »

“For the dollar component, we managed to negotiate with the creditors that they should not sue and interest should be frozen on the debt amount. So we were able to come up with a payment plan and The cedi component continues to be a challenge because it is debt held by banks, some of which has been taken over by the receiver,” he explained.

Internal measures

Commenting on what the company was doing on its end to deal with the debt, he said it was creating new revenue streams to generate enough revenue to deal with it.

“We have developed Vault Services where we offer the general public the ability to store their valuables with us here for a fee, fully insured.

“Beyond this also, we are exploring a strategic partnership such as the one we have with Manhyia regarding the Otumfuo Commemorative Gold Coin. We will continue to seek new sources of revenue to keep us afloat to be able to meet our monthly obligations,” he said.

performance 2021

The managing director pointed out that the country’s gold export figures were low compared to previous years’ figures.

He said this was due to the introduction of the three per cent withholding policy which he said encouraged gold smuggling.

He said the PMMC had, however, managed to convince the government thanks to the data it had compiled since the introduction of the tax.

“We went to government through our sector minister and we were able to demonstrate that the tax was a contributing factor to lower gold export figures. Fortunately, the government listened to us and the tax was reduced to 1.5%, effective January 1, 2022,” he said.

He said that since January 1, when the new reduced tax came into effect, the PMMC was gradually seeing an increase in gold export figures, which was encouraging.

Gold smuggling

On how to tackle the threat of gold smuggling, he said the PMMC was looking to do so from two angles.

We go through the tax angle that had already been done and we also approach it from the operational angle.

“Last year the Ministry of Lands and Natural Resources launched the Gold Smuggling Task Force and we have had two meetings so far.

“We intend to operationalize some things to be able to prosecute those who are known to be smugglers,” he said.

Go forward

On the way forward, he said the PMMC intends to complete the construction of its gold refinery this year.

When completed, he said it would add an additional revenue stream to the business.

He said the company would also engage in aggressive marketing for its vault services and jewelry manufacturing.

“The outlook looks good and we will continue to pitch in to ensure we are able to deal with legacy debt issues as well,” he said.

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John A. Bogar