It has been more than 60 years since Ghana’s first post-independence leader Kwame Nkrumah first mooted the idea that Ghana should produce aluminium from the country’s ample supply of bauxite.
The logic has always been that heavy industries that turn natural resources into useful products are critical for structural transformation. That is, moving an economy “from low productivity and labour-intensive activities to higher productivity and skill-intensive ones”. We found that new uncertainties and challenges stand in the way of Ghana’s latest efforts to develop an integrated aluminium industry. These are linked to the unfolding global energy transition agenda and shifts towards “green” manufacturing.On the one hand, it has numerous energy transition applications, from solar panels and wind turbines to electricity cables and batteries.
Firstly, they are not financially in a position to use the latest sustainable production technologies, such as carbon capture, use and storage and green hydrogen. These are needed to improve energy intensity and reduce emissions. But choosing gas as the energy solution for Ghana’s aluminium chain could jeopardise the export potential of the aluminium it produces. About 80% of Ghana’s aluminium is exported to Europe and could be subjected to carbon taxes if production is powered by gas.
Finally, other concerns are emerging around plans to mine bauxite in some of Ghana’s last remaining green forests, including the Atewa Forest Reserve.