News / Africa

Analysts: Guinea Mining Deal Could Open Doors for More Investment

A cargo ship is loaded with bauxite at the bauxite factory of Guinea's largest mining firm, Compagnie des Bauxites de Guinee (CBG), at Kamsar, a town north of the capital Conakry (2008 file photo)
A cargo ship is loaded with bauxite at the bauxite factory of Guinea's largest mining firm, Compagnie des Bauxites de Guinee (CBG), at Kamsar, a town north of the capital Conakry (2008 file photo)

The world's top bauxite producer, Guinea, recently signed its first mining agreement since the country's return to democracy, which analysts say may expedite the development of its lucrative mining sector.  

Australian mining giant Rio Tinto has agreed to pay Guinea $700 million for the right to mine iron ore in two blocks of the country's southern Simandou mountains.

As part of the deal, a new rail line and port will be built to transport ore from the mines once it starts producing by around 2015.

New prospects


Guinea's budget minister, Mohamed Diare, hailed the agreement as a sign that Guinea's fortunes could be turning.

Diare said it opens horizons for negotiations with other miners, which will enable the country to tackle the enormous and legitimate needs of its people, while also galvanizing development in other sectors of the economy.

The minister added that Guinea wants to move faster to finalize its mining code to ensure that other companies already operating in the region are complying with the new rules.

Rio Tinto once controlled the whole Simandou block but was stripped of its northern half in 2008. After months of uncertainty over whether it would lose the other half, the new deal allows it to continue operating and opens the way for billions more in investment.

Democracy to help business, development


Guinea is emerging from a long period of unrest after a bloodless coup in 2008 brought about two years of chaotic military rule. The country successfully held elections at the end of December, re-establishing democratic rule.

The new government, led by President Alpha Conde, has accused the former military junta of pilfering state coffers and has promised to bring more prosperity to its mostly impoverished population.

Guinea now wants to capitalize on its bountiful resources, especially mining, which accounts for 70 percent of the country's exports.

Analysts agree that this deal could be a sign of real change.

Guinean economist Mohamed Kourouma says it will reassure investors in the mining sector and boost the country's image as one where real contracts can be signed without bribery or corruption.

Some remain cautious


However, some warn that it's too soon to tell if this will bring broader reform. Guinean journalist Aboubabcar Diallo is one critic of the agreement.

He says the agreement introduces the possibility that all of Guinea's resources could be auctioned off to the highest bidder, opening the country to a bidding war.

Africa director for the Eurasia Group, Philippe de Pontet, says there is reason to be cautious but that overall this is a positive step.

“The government is clearly not going down the path of expropriation or rank resource nationalism, but is looking for a win-win on the country's tremendous iron-ore, bauxite and gold reserves' potential,” he said.

De Pontet says if investors see other re-negotiations go smoothly, this is a good way for Guinea to leverage its mining assets to rebuild its infrastructure, including rail, ports and roads.

You May Like

Captured IS Militants Explain Why They Fought

Fighters from Turkey, Syria tell VOA Kurdish Service what drew them to extremism, jihad More

Security Experts Split on Kenyan Barrier Wall

Experts divided on whether initiative aiming to keep out al-Shabab militants is long-awaited solution or misguided effort More

Video Philippines Wants Tourists Spending Money at New Casinos

Officials say they hope to turn Manila into the next Macau, which has long been Asia’s gambling hub More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Liberia's Almost Last Ebola Patient Grateful but Still Grievingi
X
Benno Muchler
March 26, 2015 3:41 PM
Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Liberia's Almost Last Ebola Patient Grateful but Still Grieving

Beatrice Yardolo was to make history as Liberia’s last Ebola patient. Liberians recently started counting down 42 days, the period that has to go by without a single new infection until the World Health Organization can declare a country Ebola-free. That countdown stopped on March 20 when there was another new case of Ebola, making Yardolo’s story a reminder that Ebola is far from over. Benno Muchler reports from Monrovia.
Video

Video Cambodian Land Grabs Threaten Traditional Communities

Indigenous communities in Cambodia's Ratanakiri province say the government’s economic land concession policy is taking away their land and traditional way of life, making many fear that their identity will soon be lost. Local authorities, though, have denied this is the case. VOA's Say Mony went to investigate and filed this report, narrated by Colin Lovett.
Video

Video US, South Korea Conduct Joint Military Exercises

The Eighth U.S. Army Division and the Eighth Republic of Korea Mechanized Infantry Division put on a well orchestrated show of force for the media this week during their joint military training exercises in South Korea. VOA’s Seoul correspondent Brian Padden was there and reports the soldiers were well disciplined both in conducting a complex live fire exercise and in staying on message with the press.
Video

Video Space Program Status Disappoints 'Last Man on the Moon'

One of the films that drew big crowds last week at the annual South by Southwest festival in Austin, Texas, tells the story of the last human being to stand on the moon, U.S. astronaut Eugene Cernan. It has been 42 years since Cernan returned from the moon and he laments that no one else has gone there since. VOA’s Greg Flakus reports.
Video

Video Young Filmmakers Shine Spotlight on Giving Back

A group of student filmmakers from across the United States joined President Barack Obama at the White House this month for the second annual White House Student Film Festival. Fifteen short films were officially selected from more than 1,500 entries by students aged 6 through 18. The filmmakers and their families then joined the president and a group of celebrities for a screening of their films. VOA’s Julie Taboh reports.
Video

Video VOA Exclusive: Interview with Afghan President Ashraf Ghani

Afghan President Ashraf Ghani, during his first visit as president to Washington, gave a one-on-one interview with VOA Afghan Service reporter Said Suleiman Ashna, about his request for a change in U.S. troop levels, the threat from the Islamic State, and repairing relations with the United States and Pakistan. The interview was held at Blair House, late Sunday, in Pashto.
Video

Video California Science Center Tells Story of Dead Sea Scrolls

The ancient manuscripts were uncovered in the mid-20th century, and they are still yielding clues about life and religious beliefs in ancient Israel. As VOA's Mike O'Sullivan reports, an exhibit in Los Angeles shows how modern science is bringing the history of these ancient documents to life.
Video

Video Angelina Jolie Takes Another Bold Step

Hollywood actress and filmmaker Angelina Jolie has revealed she had her ovaries and fallopian tubes removed to lower her odds of getting cancer. Doctors say the huge publicity over her decision will help raise awareness about the importance of cancer screening. VOA’s George Putic has more

All About America

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More