Released October 01, 2014 | JOHANNESBURG
en
Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--The outbreak of the deadly Ebola hemorrhagic fever in West Africa, in particular Guinea, Liberia and Sierra Leone, has cast a pall over developments in the region. It has also dented the image of the "new" Africa, whereby countries were gaining recognition for their own individual identities. Now, President Barack Obama is sending 3,000 U.S. troops to assist in the curbing and eradication of the disease.
Major mining companies have signed a long-term commitment to affected countries and the well-being of their people, and have welcomed the U.S. initiative.
The U.S. Geological Survey ranks Africa as holding the largest or second-largest reserves of bauxite, cobalt, industrial diamonds, manganese, phosphate rock, platinum group metals and zirconium. Large areas of the continent have not yet been explored for mineral resources. In the early 1990s, the continent was receiving only about 5% of global mining and development expenditures, but changes in the sector caused the continent to receive 15% of global mining investments in 2012.
Botswana is the largest miner of diamonds in the world, and has increased its position in the diamond global value chain by increasing the amount of local processing and diamond sales through the relocation of De Beers' (Luxembourg, Luxembourg) activities from London to the local capital Gaborone. This move has boosted downstream manufacturing activity. Copper, nickel, soda ash, gold and uranium are also extracted in significant quantities.
The country is estimated to hold more than 200 billion tons of coal, for which the extraction and export has become a key development priority. Improvements are now taking place in the rail-freight transportation industry to give greater access to South African and Atlantic and Indian Ocean ports. This augurs well for coal project developments, which also are driven by domestic and regional power-generation developments.
Various initiatives have been taken by the government to improve the business environment, including an economic diversity drive, a national export strategy and a private-sector development strategy. Efficiency-enhancing measures include investment in broadband width and the modernization of the payment system.
Gross domestic product (GDP) growth increased to 5.4% in 2013 from 4.2% in 2012, and should remain at about 5% through 2015.
Ghana is the second-largest gold producer in Africa, after South Africa. The external sector will continue to experience a widened current account deficit of about 12% of gross domestic product (GDP) in 2014, prompted by a decline in commodity prices of export commodities, particularly gold and cocoa.
During the past six years, the country has maintained an average annual growth rate of about 6%. In 2013, growth dropped to 4.4% from 7.9% in 2012. In 2014, the forecast growth is 7.7%. In 2015, the forecast is 8%, boosted by improved oil and gas production, increased private-sector investment and sustained political stability.
Mozambique experienced a growth rate of 7%, driven by strong foreign direct investment (FDI) in the mining sector and increased public expenditures. If the political climate remains stable, growth is forecast to remain above 8% in 2014 and 2015, supported by increased coal production and the probable start of a major liquefied natural gas (LNG) plant. The country's part in global value chains is mainly in the Mozal aluminum smelter.
The contribution of the country's mining sector to the economy is expected to make a major increase in the medium-to-long term, driven by a sharp projected increase in global coal production. According to the International Monetary Fund, mega-projects have the potential to contribute 18% of total value added in the economy. Coal production could exceed 100 million tons annually within the next five years, depending on the speed of executing rail-line projects from the coalfields to export terminals. Rio Tinto plc (NYSE:RIO) (London, England) and Vale S.A. (NYSE:VALE) (Rio de Janeiro, Brazil) already have stepped away from projects due to transport infrastructure problems.
Namibia's mineral exports constitute 50% of the country's total export earnings. The country's output includes diamonds, uranium, copper, magnesium, zinc, silver, gold, lead, semi-precious stones and industrial minerals. Namibia is the fourth-largest exporter of non-fuel minerals in Africa, and the mining sector is expected to post a real growth of 12.5% annually through 2017.
From a healthy growth rate of 5%, GDP growth decreased to 4.2% in 2013, and is projected to be 4.3% in 2014, and 4.4% in 2015. There should be some benefit from the government's launch of a major housing project, the start of the expansion of the Walvis Bay container terminal expansion, and large investment projects in mining. Moves are being made to reduce the high cost of doing business, removing bottlenecks in infrastructure, and investing in skills as part of a greater diversification strategy.
Tanzania's mining industry is small in terms of the overall economy, but is very important as a source of export revenues. There are growth prospects in the estimated 90% of the country's minerals, which are unexploited. A nickel mine and major uranium mine will start in the course of the next year.
Growth for 2013 was 7%, up from 6.9% in 2012, and is forecast at 7.2% for 2014, and 7% for 2015. Drivers are communications, transport, finance, construction, agriculture and manufacturing. In the medium term, growth will be supported by ongoing investments in infrastructure, and continuing investment in gas development.
Democratic Republic of Congo (DRC) saw GDP growth rise to 8.1% in 2013, from 7.2% in 2012, and is forecast to reach 8.5% in 2014, and 8.6% in 2015, driven by investments in the mining sector (copper, cobalt and gold), where a number of companies have moved from exploration to production since 2013. Improved agricultural productivity and infrastructure reconstruction also have contributed to growth.
Possible renewed outbreaks of factional armed strife in the east of the country cast a constant shadow on prospects for stability. There does not appear to be much "trickle down" from incoming wealth, with malnutrition and a lack of social support, such as for education, which is a negative for real development prospects.
Guinea saw growth fall to 2% in 2013 from 3.9% in 2012, following a drop in mining investments. The drop was put down to social unrest surrounding government interference in elections. Growth could rise in 2014 to 4.2%, driven by agriculture, construction and improved electricity supply.
The Simandou Mountain holds some of the world's richest iron-ore deposits. The country is expected to attract $50 billion investments during the next 10 years. But wrangling between investors and the government has hindered development. At full production, Rio Tinto's $20 billion project could export up to 95 million tons of iron ore annually, but various agreements have to hold together for that to happen.
For related information see October 25, 2013, article--Guinea Taps Rio Tinto for Simandou Mining Project's Iron Ore Export Railway.
Zambia appears to be on an upward growth path, despite a fall to 6.5% in 2013 from 7.2% in 2012 .The decrease was mainly due to a bad harvest season. The growth forecast for 2015 is 7.4%. Mining investments are driving sectors such as construction, transport and energy.
Copper contributes about 70% in the country's export earnings. The extractive industry, as the main exporter, has potential for upstream value chain development; however, transportation costs in the land-locked country add 40% to total product costs.
Manufacturing contributed 10% of GDP in 2013, with food and beverages accounting for 66% of value-added manufacturing. Initiatives are in place to diversify sector employment opportunities, especially for the growing band of unemployed youth.
South Africa's mining industry is working its way out of a difficult period of caused by protracted strikes in the country's platinum belt, including the "Marikana massacre," and the development of new industry regulations. Coupled with need for a more certain business environment is the development of new mining methods to improve productivity in deep and difficult environments. Models for beneficiation of ore to add value before export also are becoming a catalyst of change in the industry.
There is also ongoing movement among international mining majors to separate their local South African operations and list their international operations on foreign exchanges.
As an important hub in the global value chain, South Africa has the largest unexploited reserves of key minerals and metals in the world, and continues to be the leading recipient of Africa's share of global foreign direct investment (FDI). Major companies are also committing billions of dollars to expand existing operations and develop new mines.
Low investments in 2013 saw growth at 1.9%, following 2.5% in 2012; this could rise to 2.7% in 2014 and 3% in 2015.
Angola's National Demining Institute has identified 42 possible new mining areas. The areas are based in the eastern corridor of the central Huambo province. Technical surveys are in progress. Clearance of land mines, which were left over from the country's long civil war, and rehabilitation of the areas, has rendered them suitable for mining.
Guinea is looking to cooperate with Angola on mining development.
The Nigerian mining sector has potential, as reflected in the country's geology, but is hamstrung by the effect of piecemeal artisanal/privateer activities, and the lack of effective development regulations. No effective infrastructure has been developed to support mining development. Many of the artisanal miners are peasant farmers who are lured by the potential of gold on their land. Child labor also is used.
As a result of their activities, many suffer from lead and mercury poisoning, which is used in the crude production process. Nigeria ranks below 50th in the global mining league.
In 2013, there was a move between Nigeria and South Africa to promote the development of small-scale gold mining from the existing artisanal base. By procuring South African machinery and expertise, the aim is to improve Nigerian mining technology and commodity pricing.
For related information, see January 21, 2014, article - Nigeria Licenses Foreign Miners to Exploit Rich Gold and Iron Resources.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
Major mining companies have signed a long-term commitment to affected countries and the well-being of their people, and have welcomed the U.S. initiative.
The U.S. Geological Survey ranks Africa as holding the largest or second-largest reserves of bauxite, cobalt, industrial diamonds, manganese, phosphate rock, platinum group metals and zirconium. Large areas of the continent have not yet been explored for mineral resources. In the early 1990s, the continent was receiving only about 5% of global mining and development expenditures, but changes in the sector caused the continent to receive 15% of global mining investments in 2012.
Botswana is the largest miner of diamonds in the world, and has increased its position in the diamond global value chain by increasing the amount of local processing and diamond sales through the relocation of De Beers' (Luxembourg, Luxembourg) activities from London to the local capital Gaborone. This move has boosted downstream manufacturing activity. Copper, nickel, soda ash, gold and uranium are also extracted in significant quantities.
The country is estimated to hold more than 200 billion tons of coal, for which the extraction and export has become a key development priority. Improvements are now taking place in the rail-freight transportation industry to give greater access to South African and Atlantic and Indian Ocean ports. This augurs well for coal project developments, which also are driven by domestic and regional power-generation developments.
Various initiatives have been taken by the government to improve the business environment, including an economic diversity drive, a national export strategy and a private-sector development strategy. Efficiency-enhancing measures include investment in broadband width and the modernization of the payment system.
Gross domestic product (GDP) growth increased to 5.4% in 2013 from 4.2% in 2012, and should remain at about 5% through 2015.
Ghana is the second-largest gold producer in Africa, after South Africa. The external sector will continue to experience a widened current account deficit of about 12% of gross domestic product (GDP) in 2014, prompted by a decline in commodity prices of export commodities, particularly gold and cocoa.
During the past six years, the country has maintained an average annual growth rate of about 6%. In 2013, growth dropped to 4.4% from 7.9% in 2012. In 2014, the forecast growth is 7.7%. In 2015, the forecast is 8%, boosted by improved oil and gas production, increased private-sector investment and sustained political stability.
Mozambique experienced a growth rate of 7%, driven by strong foreign direct investment (FDI) in the mining sector and increased public expenditures. If the political climate remains stable, growth is forecast to remain above 8% in 2014 and 2015, supported by increased coal production and the probable start of a major liquefied natural gas (LNG) plant. The country's part in global value chains is mainly in the Mozal aluminum smelter.
The contribution of the country's mining sector to the economy is expected to make a major increase in the medium-to-long term, driven by a sharp projected increase in global coal production. According to the International Monetary Fund, mega-projects have the potential to contribute 18% of total value added in the economy. Coal production could exceed 100 million tons annually within the next five years, depending on the speed of executing rail-line projects from the coalfields to export terminals. Rio Tinto plc (NYSE:RIO) (London, England) and Vale S.A. (NYSE:VALE) (Rio de Janeiro, Brazil) already have stepped away from projects due to transport infrastructure problems.
Namibia's mineral exports constitute 50% of the country's total export earnings. The country's output includes diamonds, uranium, copper, magnesium, zinc, silver, gold, lead, semi-precious stones and industrial minerals. Namibia is the fourth-largest exporter of non-fuel minerals in Africa, and the mining sector is expected to post a real growth of 12.5% annually through 2017.
From a healthy growth rate of 5%, GDP growth decreased to 4.2% in 2013, and is projected to be 4.3% in 2014, and 4.4% in 2015. There should be some benefit from the government's launch of a major housing project, the start of the expansion of the Walvis Bay container terminal expansion, and large investment projects in mining. Moves are being made to reduce the high cost of doing business, removing bottlenecks in infrastructure, and investing in skills as part of a greater diversification strategy.
Tanzania's mining industry is small in terms of the overall economy, but is very important as a source of export revenues. There are growth prospects in the estimated 90% of the country's minerals, which are unexploited. A nickel mine and major uranium mine will start in the course of the next year.
Growth for 2013 was 7%, up from 6.9% in 2012, and is forecast at 7.2% for 2014, and 7% for 2015. Drivers are communications, transport, finance, construction, agriculture and manufacturing. In the medium term, growth will be supported by ongoing investments in infrastructure, and continuing investment in gas development.
Democratic Republic of Congo (DRC) saw GDP growth rise to 8.1% in 2013, from 7.2% in 2012, and is forecast to reach 8.5% in 2014, and 8.6% in 2015, driven by investments in the mining sector (copper, cobalt and gold), where a number of companies have moved from exploration to production since 2013. Improved agricultural productivity and infrastructure reconstruction also have contributed to growth.
Possible renewed outbreaks of factional armed strife in the east of the country cast a constant shadow on prospects for stability. There does not appear to be much "trickle down" from incoming wealth, with malnutrition and a lack of social support, such as for education, which is a negative for real development prospects.
Guinea saw growth fall to 2% in 2013 from 3.9% in 2012, following a drop in mining investments. The drop was put down to social unrest surrounding government interference in elections. Growth could rise in 2014 to 4.2%, driven by agriculture, construction and improved electricity supply.
The Simandou Mountain holds some of the world's richest iron-ore deposits. The country is expected to attract $50 billion investments during the next 10 years. But wrangling between investors and the government has hindered development. At full production, Rio Tinto's $20 billion project could export up to 95 million tons of iron ore annually, but various agreements have to hold together for that to happen.
For related information see October 25, 2013, article--Guinea Taps Rio Tinto for Simandou Mining Project's Iron Ore Export Railway.
Zambia appears to be on an upward growth path, despite a fall to 6.5% in 2013 from 7.2% in 2012 .The decrease was mainly due to a bad harvest season. The growth forecast for 2015 is 7.4%. Mining investments are driving sectors such as construction, transport and energy.
Copper contributes about 70% in the country's export earnings. The extractive industry, as the main exporter, has potential for upstream value chain development; however, transportation costs in the land-locked country add 40% to total product costs.
Manufacturing contributed 10% of GDP in 2013, with food and beverages accounting for 66% of value-added manufacturing. Initiatives are in place to diversify sector employment opportunities, especially for the growing band of unemployed youth.
South Africa's mining industry is working its way out of a difficult period of caused by protracted strikes in the country's platinum belt, including the "Marikana massacre," and the development of new industry regulations. Coupled with need for a more certain business environment is the development of new mining methods to improve productivity in deep and difficult environments. Models for beneficiation of ore to add value before export also are becoming a catalyst of change in the industry.
There is also ongoing movement among international mining majors to separate their local South African operations and list their international operations on foreign exchanges.
As an important hub in the global value chain, South Africa has the largest unexploited reserves of key minerals and metals in the world, and continues to be the leading recipient of Africa's share of global foreign direct investment (FDI). Major companies are also committing billions of dollars to expand existing operations and develop new mines.
Low investments in 2013 saw growth at 1.9%, following 2.5% in 2012; this could rise to 2.7% in 2014 and 3% in 2015.
Angola's National Demining Institute has identified 42 possible new mining areas. The areas are based in the eastern corridor of the central Huambo province. Technical surveys are in progress. Clearance of land mines, which were left over from the country's long civil war, and rehabilitation of the areas, has rendered them suitable for mining.
Guinea is looking to cooperate with Angola on mining development.
The Nigerian mining sector has potential, as reflected in the country's geology, but is hamstrung by the effect of piecemeal artisanal/privateer activities, and the lack of effective development regulations. No effective infrastructure has been developed to support mining development. Many of the artisanal miners are peasant farmers who are lured by the potential of gold on their land. Child labor also is used.
As a result of their activities, many suffer from lead and mercury poisoning, which is used in the crude production process. Nigeria ranks below 50th in the global mining league.
In 2013, there was a move between Nigeria and South Africa to promote the development of small-scale gold mining from the existing artisanal base. By procuring South African machinery and expertise, the aim is to improve Nigerian mining technology and commodity pricing.
For related information, see January 21, 2014, article - Nigeria Licenses Foreign Miners to Exploit Rich Gold and Iron Resources.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, three offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.
