by Roman Baudzus, GoldMoney.com:
Many African governments have decided that they want a greater say in the mining industries’ operations. Currently, it looks as if the governments of some producing countries are even planning to take over the production of important raw materials such as gold, diamonds, cobalt, crude oil and uranium. Governments plan to increase their revenue through the private mining sector. It is hoped that these revenues shall be invested in social programmes and infrastructure in order to stimulate the economy of underdeveloped regions.
At the end of May, Ethiopia hosted an African-Indian Forum Summit for Enhanced Cooperation, which gave birth to the Addis Ababa Declaration. In this declaration, more than half of all African governments define how they will restructure their mining industry. Experts expect that soon most African mining companies – which are mostly privately operated – will face countless problems, as African governments aim to exert more control over mining production. Hitherto, once obtaining their license, foreign mining companies could produce raw materials and sell them at the global markets without any governmental control. But now, many African governments deem that the royalties and export taxes imposed on mining companies are not enough. It seems that African governments soon will exert more control over the mining industry than ever before.
Should force commodities up as the only thing aficans can organize is disaster.