MINING NEWS
Governments urged to cra� tting policies
for mining industry
Poorly thought-out mining policies are impacting Africa ' s mining sector , the annual mining jamboree Mining Indaba in Cape Town , South Africa has heard . Sharing the same sentiments , stakeholders said uncertainty and inconsistency are hampering the search for new mining investment on the continent . In addition , the policies have cast a shadow over the continent ' s longer-term economic growth . �e world ' s largest mining investment conference highlighted a subdued investor mood in mineral-rich South Africa , Africa ' s largest mining destination “ Amid signs that the commodity cycle may be turning , South Africa will not be positioned to take advantage of the green shoots of spring , or the heat of summer , unless the environment for mining is conducive to private-sector investment . And the [ South African Mineral Resources ] minister ' s bland speech was frighteningly short of any sign that he had understood investors ' concerns about the regulatory environment for mining – or that he had intentions of doing anything about these concerns ,” noted Johannesburg nancial newspaper , Business Day , during the Mining Indaba . �e publication further said there are other much easier and more attractive destinations for mining investment , by junior or senior miners , and international investors are increasingly passing South Africa by . Meanwhile Botswana still shines as a model mining-investor destination by international standards . However , the serious investor concerns are not limited to South Africa but virtually all African mining destinations – Zambia , Ghana , Guinea , Tanzania and the Democratic Republic of Congo ( DRC ). To a large extent , these concerns stem from sudden and unexpected changes made by many mineral-dependent African countries to their mining regimes a�er the 2008-09 global nancial crisis . Hit by the twin hammers of lower revenue and rising debt , countries attempted to extract more money from their mining sectors at a time when they could least afford it . “ Many African countries made rash and unpredictable changes to their mining regimes , creating regulatory uncertainty and harming investor con dence ,” said Peter Leon , a partner at the global legal practice Herbert Smith Freehills . Ghana , for example , announced in 2012 that it would impose a 10 % windfall tax on gold mining and review its scal stability agreements with foreign mining companies , but failed to follow through on these measures . �en in 2014 , Ghana amended its mining law to replace the xed 5 % royalty with ' wide executive discretion ' to prescribe new rates . �e resulting regulatory uncertainty ' weighed on sentiment ', and considerably affected Ghana ' s ranking in the authoritative Fraser Institute ' s annual review of the investor attractiveness of the world ' s mining destinations . “ Ghana fell from its enviable 2011 ranking of 17th in the world to 38th in 2012 , and then uctuated from 30th in 2013 to 44th in 2014 and 31st in 2015 ,” said Leon . Another notable example is the DRC , Africa ' s largest copper producer , the world ' s largest cobalt producer and a major source of diamonds , gold , tantalum and tin . While the country ' s 2002 mining code “ strikes a
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