The title may sound hyperbolic. But Africa is indeed on the verge of complete upheaval in its minerals sector over the coming several days.
For one reason: government.
Start in major mining center South Africa. Where an announcement is expected any day on a new “strategic minerals” law in the country.
The government here has been working for years on a new mining code. With the “strategic” designation being one of the most contentious points.
In short, regulators want to take greater control of sectors that are deemed to be in the public interest. Including possibly regulating sales, prices, and other aspects of mining for the nominated minerals. Related: Does This Discovery Show An Exploration Hotspot Rising?
There has been discussion that this could include coal–which meets 77% of South Africa’s primary energy demand. Iron ore, platinum, chromite and vanadium are other possibilities.
An announcement on exactly which minerals will be designated strategic was expected late last week–but has not yet emerged. Meaning we might see some clarity on this key issue in the days ahead.
Changes are also afoot to the north, in Democratic Republic of Congo–the world’s fifth-largest copper-producing nation. Where officials said last week they are submitting a new national mining code for ratification.
The DRC government has previously said it wants to increase taxes and royalties on copper miners. Officials had been consulting with the mining industry on the matter, but said last week they have “unilaterally” halted such discussions–and are now tabling the new mining code for approval.
Representatives of the country’s Chamber of Mines said that the royalty issue has not been solved. And cautioned that passing of the new law could be a “material threat to further investment.” Related: 839 New Mining Projects Are About To Launch Here
Finally, there’s Zimbabwe. Where platinum miners have reportedly been scrambling to get clarity on the government’s recently-imposed 15% export tax on the metal.
News last week suggests that the results of this new tax could be dire. With a memo leaked to Reuters from management of Zimbabwe’s largest platinum mine, Mimosa, suggesting that the operation “will be forced to go on closure” under the new tax regime.
All of which suggests we could see some game-changing developments very soon. Watch for a final decision from South Africa on strategic minerals, approval of the draft mining code in DRC and details on potentially increased royalties, and more developments from platinum miners in Zimbabwe.
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Here’s to regulatory changes,
Dave Forest
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