Green National Accounting: A Case of Ghana’s Mining Sector

Abstract

Economic activity in Ghana is largely dependent on natural resources, more specifically minerals which are exploited unsustainably. Using the net price and user cost approaches, the paper estimates the depletion of mineral resources for the period 2000 – 2012 and consequently the adjusted national income for these resources. The results using the net price method indicates that gold, diamond, bauxite and manganese exhibit some level of depletion cost with gold having the highest depletion, implying that without reinvesting the proceeds from the sale of the minerals resources in alternative capital, the welfare of future generations will be compromised. Estimates using the user cost also follows similar trend but lower than that of the net price approach. The study therefore recommends government to adapt a green accounting framework into its System of National Accounts and also reinvest some of the proceeds generated from the exploitation of mineral resource in other forms of capital such as education, health, roads which has the capacity to reproduce itself so that there will be sustainable use of the resource