Johannesburg, South Africa — MININGREVIEW.COM — 10 July 2008 – The current boom in commodity prices presents African countries with a unique opportunity to build their economies and create lasting value for their people, says Randgold Resources chief executive Mark Bristow.
“While Africa is rich in mineral wealth it is poor in every other way, and this poverty is the main obstacle to the development of its resources and the stimulation of economic growth,” he told an economic geology conference here. “The metals price boom provides the continent with the means to kick-start its economies, much as South Africa used its gold to build a broad economic base years ago. Conditions for prosperity have never been better, but this opportunity can also be squandered if the temptation to cash in immediately triumphs over a long-term commitment to development,” he warned.
“What is needed now,” said Bristow, “is for the mining industry as developers of these resources – and African governments as their custodians – to combine forces in an effort to establish a lasting economic benefit for all the people.”
He added that an analysis of fiscal and mineral rights regimes throughout Africa had shown that almost half of all mining profits went to governments in the form of taxes, royalties and dividends.“Profitable mining operations generate enough value to benefit all stakeholders, contrary to what the anti-mining lobby and some unscrupulous politicians would have the world believe,” he said.
For that benefit to materialise fully, however, government and industry would have to form a partnership in which each accepted and met certain obligations.
“Government had a responsibility to maintain a fiscal and regulatory regime that was conducive to mining; to play a part in infrastructural development; and above all to share the wealth created by mining equitably with all its people,” Bristow continued.“Mining for its part had to make a long-term commitment to its host country; to re-invest for sustainability; and to help the country’s people realise their hopes of a better life.”