Building trust between miners, host governments a prerequisite to foster economic prosperity

Date: Mar 6, 2018
Endemic mistrust between private sector miners and African jurisdictions belies the spirit and objectives set out in the African Union’s African Mining Vision, an audience attending the eighth MineAfrica panel discussion heard on Sunday.

“The biggest problem is mistrust between governments and the private sector. We are currently grappling with this issue,” technical advisor to the Association Chamber of Mines and other Mining Associations of Africa and CEO of the Namibia Chamber of Mines Veston Malango said.

“As long of this mistrust is perpetuated, we will not make progress. The African Mining Vision will be difficult to pursue if we cannot solve this fundamental problem of instilling a higher level of trust.”

According to him, the strategy is simple – the mining industry will have to undertake introspection and look at the perception governments have towards the mining industry. “If we do not like the outcome, it would be better to change ourselves than to try and fix mirror.”

He believes that transparency is key, since it forms the foundation of trust.

However, this goes both ways, and far too often miners do not play open cards with their host governments, not fully disclosing production figures to avoid full taxation. Conversely, miners fear governments wanting to ‘kill the golden goose’ by taxing the life out of an industry during commodity boom times.

“We are working to implement the African Mining Vision. We want to make it work without killing the industry. We have to create the linkages to facilitate the goals of the African Mining Vision to create shared prosperity for all stakeholders,” he said.


Governments understand that miners do not come to their countries for humanitarian missions, but are there to produce minerals in the pursuit of profit. However, the minerals beneath African people’s feet belong to them, and it is incumbent on the industry to ensure that communities and host jurisdictions share in the economic benefit of their minerals, Ethiopia’s Mines, Petroleum and Natural Gas Minster Ato Motuma Mekassa stressed.

“We started late with mining policy development. But while we are formulating our policies, we aim to create political stability to enhance mining investment, while taking a ‘best-lessons approach’ for the long term. We know companies are coming for the profit, not only to leave a social benefit,” he said, adding that to further mining investment in the country, the state is facilitating geomapping and focusing on creating supporting infrastructure.

“We have untapped resources in Ethiopia, but we want to make sure our communities benefit from investment. We try to establish accountability and transparency as key to mining development.”

The African Mining Vision was adopted in 2009 as a framework to translate several outcomes focused around economic development to the benefit of Africans. The African Mineral Development Centre was created to assist in this process and it is currently actively working with 30 African jurisdictions to stimulate investment, United Nations Economic Commission for Africa’s Africa Minerals Development Centre economic affairs office for mineral governance Paul Msoma noted.

“These frameworks are instruments to support the private sector, to the benefit of locals. We’ve created a compact to establish win-win situations with the private sector. The vision calls for the creation of strong linkages within the minerals sector, that encompass skills training, industrialisation, and open business involvement.”
Similar to Ethiopia’s economic development, Sudan is late to the party, following years of political instability, civil war and international sanctions.
“Sudan has untapped natural resource opportunities. We have water, land and 40 minerals – while we are extracting only 13, led by gold,” Sudan’s Mining Minster Hashim Salim advised. So successful has the country’s emerging gold sector been, that it produced 107 t of gold in 2017, ranking it as the second biggest gold producer in Africa, and ninth largest in the world.

He noted that minerals were largely ignored in the past. “We’ve cleared out the old and made way for new ideas – we have new ideas and bold projects. A paradigm shift is needed in the West about Sudan. Our presence here confirms that we are ready for business.”

He appealed to the private sector for help and assistance to meet the country’s development goals, but investment had been stymied by years of international sanctions that had kept the country from accessing new technologies.

“We do not need magic to change Sudan, we already have the power within ourselves. We’ve built a new foundation for a new Sudan. You are welcome. We’ve already relaxed our investment regime to attract investment.”

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