Min­ing can boost growth to serve Africa’s bur­geon­ing pop­u­la­tion

The Star Early Edition - - INTERNATIONAL - Kieran Guil­bert

ON A con­ti­nent bet­ter known for en­rich­ing colonis­ers and cor­po­ra­tions by ex­port­ing its gold, cop­per and di­a­monds, so­called devel­op­ment min­er­als – rang­ing from lime­stone to gran­ite – could help Africa fuel its own eco­nomic growth.

The sec­tor, es­ti­mated by the UN to em­ploy at least 8 mil­lion Africans, could cre­ate mil­lions more jobs across the con­ti­nent – many for young peo­ple and women – to meet a fast-grow­ing need for hous­ing and in­fras­truc­ture, min­ing ex­perts say.

Devel­op­ment min­er­als re­fer to ma­te­ri­als and min­er­als that are con­sid­ered low-value – such as gran­ite, gravel and sand – and are mined, pro­cessed, man­u­fac­tured and used lo­cally in in­dus­tries from con­struc­tion and man­u­fac­tur­ing to agri­cul­ture. “They are sig­nif­i­cant be­cause the pop­u­la­tion of Africa is go­ing to keep boom­ing, with many liv­ing in ur­ban en­vi­ron­ments,” An­to­nio Pe­dro, the Cen­tral Africa direc­tor at the UN Eco­nomic Com­mis­sion for Africa, told Reuters.

Po­ten­tial

“The po­ten­tial of these min­er­als for lo­cal economies is much higher than for me­tal­lic or pre­cious min­er­als, as en­try bar­ri­ers like re­search and devel­op­ment, and cap­i­tal, are lower,” he said. The EU, the African, Caribbean and Pa­cific (ACP) na­tions and the UN in 2015 launched a $14 mil­lion (R185m) project to boost the fledg­ling sec­tor and im­prove its over­sight.

But like Africa’s big ex­trac­tive in­dus­tries – plagued by prob­lems from child labour to poor health and safety stan­dards – the po­ten­tial of the devel­op­ment-min­eral sec­tor may be held back by labour and rights abuses un­less it is prop­erly reg­u­lated.

“These com­modi­ties (devel­op­ment min­er­als) aren’t go­ing to fuel wars or foul rivers,” said Daniel Franks, man­ager of the ACP-EU devel­op­ment-min­er­als pro­gramme.

“Yet there are a large num­ber of labour and health and safety is­sues which are com­mon through­out the sec­tor… and child labour is preva­lent,” he added.

African gov­ern­ments have long been en­cour­aged or pres­sured by multi­na­tion­als to pri­ori­tise the min­ing of me­tals for ex­port, which gen­er­ate quick and big re­turns for na­tional cof­fers while al­low­ing the au­thor­i­ties to take a back seat, in­dus­try ex­perts say.

“Gov­ern­ments are ex­tract­ing the roy­al­ties rather than us­ing them to de­velop ex­per­tise lo­cally or im­prove the min­ing sec­tor,” said Gavin Hil­son, a pro­fes­sor and the chair of sus­tain­abil­ity in busi­ness at Bri­tain’s Univer­sity of Sur­rey.

“But there is po­ten­tially a se­ri­ous stream of rev­enue from ar­ti­sanal and small-scale min­ing if you reg­u­late it and tax it prop­erly.”

Decades of ne­glect have led to poorly de­signed or im­ple­mented poli­cies for small-scale min­ing, and a lack of rights and sup­port for min­ers, the UN says.

But ris­ing ur­ban­i­sa­tion in Africa could spur gov­ern­ments to breathe new life into the devel­op­ment min­er­als sec­tor.

Half of all Africans will live in cities by 2030, from 36 per­cent in 2010, ac­cord­ing to the World Bank. To cope with pop­u­la­tion growth, Africa’s ma­jor cities will need more roads, hos­pi­tals and power sta­tions.

Around $360 bil­lion in in­fras­truc­ture in­vest­ments are needed by 2040 to make the con­ti­nent com­pet­i­tive and pro­duc­tive, the African Devel­op­ment Bank says. For each bil­lion in­vested, be­tween 3 and 7 mil­lion jobs are cre­ated, it es­ti­mates.

Plung­ing com­mod­ity prices – which saw eco­nomic growth in sub-Sa­ha­ran Africa slump to a two-decade low last year – could also prove a cat­a­lyst for the devel­op­ment-min­er­als sec­tor.

Nige­ria, a ma­jor oil pro­ducer, is look­ing to di­ver­sify its econ­omy away from a reliance on crude pro­duc­tion amid its first re­ces­sion in 25 years, and small-scale min­ing is on the agenda.

“Pre­vi­ously, the gov­ern­ment was only in­ter­ested in tax rev­enues (from the min­ing sec­tor),” said Nige­rian civil ser­vant and min­ing of­fi­cial Sam Hart. “Now, pro­duc­tiv­ity comes first.” – Reuters

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