At the various African government presentations, it was often
'standing room only' as conference participants jostled with each other for a
space to hear what the various ministers had to say.
The major African
mining destinations were well represented, but the ministerial mining forums
gave some of the less well known countries an opportunity to tell investors what
their country has to offer. One such country was Mauritania, where gold and
copper projects are in an advanced phase and where there are deposits of iron
ore, uranium, black sands and phosphates.
But these ministers faced some
serious questions from potential investors, reflecting their concerns about the
obstacles faced by mining companies on the continent.
There were often
probing questions about access to power supply - a major concern for miners - as
well as infrastructure shortcomings, taxes and royalties, resource nationalism
and rising costs.
Sternford Moyo, Senior Partner at Scanlen &
Holderness, the Zimbabwean Lex Africa member law firm, commented that Africa has
enormous growth prospects centered on its resources. However, to harness its
full potential and develop through its mineral resources, there are a number of
fundamental prerequisites which African policy makers will have to address.
The most important of these appears to be a redefinition of the role of
the state in extractive industries and indeed in business in general, Moyo said.
"There is a dangerous school of thought which promotes the state's
direct participation in mining ignoring the old age wisdom that the business of
government is not good business. To play its rightful role, the state should,
through appropriate mining regulation, ensure that there is a balance between
the interests of investors and those of communities in which they invest.
"Furthermore, it can, through its international policy instruments seek
to influence pricing on the international markets," he said.
At a
domestic level, it can introduce policy instruments to prevent degradation of
the environment, ensure that appropriate social responsibility is pursued and
generally aim to achieve a situation where there is a relationship between
depletion of resources and development of the communities endowed with mineral
resources.
It can also, through good governance, respect for property
rights and the rule of law create an investor friendly environment, he noted.
But it was not only the potential investors who raised concerns. Some
African government officials had issues of their own. Common concerns raised by
government included safety procedures, mining licences and environmental issues.
Dow Jones Newswires reported that Guinea's s mining ministry will begin
an audit of companies operating in the country next month which could see some
licences revoked, as the country is currently not "getting the benefit from its
resources," the minister said.
"A lot of companies took licences and
then went all over the world to sell them," Mines Minister Mohamed Lamine Fofana
said.
"If the miner isn't fulfilling his commitments his licence will be
cancelled," he said.
Guinea is a significant producer of bauxite, a raw
material used in the process to make aluminum.
In addition, Zambia's
minister of mines said he will request mine safety is improved when he meets
with Chinese mine managers operating in Zambia and the ambassador next week.
"Some methods aren't up to accepted practices," minister Wylbur Simuusa
told Dow Jones Newswires on the sidelines of the Indaba. "If they don't improve
we may be forced to take their (the miners') licences."
A report last
year from Human Rights Watch highlighted safety violations, which followed
complaints from workers at Chinese-run mines in Zambia.
Simuusa said he
has visited some mines and found operations underground were unsafe. He had
complaints that waste from mines was washing into local rivers, he said.
The corporate presentations of the miners active on the continent,
however, were generally upbeat, highlighting the various sustainability
projects, upliftment programmes and cooperation with government agencies being
the rule rather than the exception.
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HackerInvestor44 Feb 9, 2012
Australian mining companies have huge war chests that they can now use to invest in mining in Africa. Because SA miners have been crippled by paralyzed government policy, SA cannot compete with Australia and China.