The number of workers to be affected under the exercise is, however, yet to be agreed on by management and organised labour.
The exercise is the final phase of downsizing the workforce, which began last year with 430 sent home. The company is expected to spend about $220 million in settlement packages, which is being negotiated for among the management, the local union and representatives of the Ghana Mine Workers Union.
In contrast, though, the company is expected, within two years, to re-employ a highly skilled small workforce, in line with a redesign plan as it moves from its northern site to a less labour-intensive southern site.
A Senior Vice-President of AngloGold Ashanti Ghana, Mr Mark Morcombe, broke the news at a special durbar for workers, community representatives, as well as chiefs and opinion leaders, to explain the rationale behind the action at Obuasi Thursday.
Among the factors responsible for the lay-off are the rising cost of production, high under-performance of workers and unstable world market prices.
Mr Morcombe said due to the increase in the world price of gold in 2008 which raked in a lot of profit, the company was encouraged to pump in about $600 million from its mother company in South Africa, only to notice that it was a wrong move.
Apparently, he said, the increase in the profit margin was not as a result of increase in productivity but rather the short-term increase in world market prices, adding that the company ran into huge losses when prices dropped.
Mr Morcombe said the company wanted to face the challenges head-on and was taking the “short-term pain for a long-term success”.
The new site, according to him, was endowed with 6.5 million ounces of gold, which could last up to 17 years. He said while relocating to the new site, the current site was to be safeguarded against possible ‘galamsey’ activities and reshaped for a future comeback.
Mr Morcombe added that current facilities at the mine were to be turned into a university college of mines, while the company meet with heads of its social facilities, including hospitals and farms, to make them self-sustaining.
He called for support from all stakeholders, including the government, to make the exercise a success and save the company from imminent collapse.
Source: Daily Graphic
An Entrepreneur and Philanthropist. Editor-in-Chief of www.233times.com. A Senior Journalist with Ghanaian Chronicle Newspaper. An alumnus of Adisadel College where he read General Arts. He holds first degree in Bachelor of Arts from the University of Ghana; Political Science (major) and History (minor). He has also pursued MSc Corporate Social Responsibility (CSR) and Energy with Public Relations (PR) at the Robert Gordon University in the United Kingdom. He is a 2018 Mandela Washington Fellow (YALI) who studied at Clark Atlanta University on the Business and Entrepreneurship track. His mentors are Rupert Murdoch, Warren Buffet, Sam Jonah, Kwaku Sakyi Addo and Piers Morganview all posts by: Nana Kwesi Coomson
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