Mali has suspended new mining permits for foreigners following a deadly mining accident that killed over 40 people. The government aims to enhance safety and reform the mining sector to increase state revenue from gold production. The reforms could generate significant annual revenue and address issues like tax evasion, while Mali’s mining landscape is heavily influenced by foreign firms.
Mali, the second-largest gold producer in Africa, has announced a suspension on the issuance of mining permits to foreign companies. This decision comes in the wake of a tragic mining collapse that resulted in over 40 casualties, leading the government to reassess its mining regulations and prioritize safety within the sector. The Council of Ministers has banned artisanal mining permits for foreigners until investigations into this disaster are concluded.
The accident occurred last month when an illegal gold mine in the Kayes region collapsed, claiming 43 lives, predominantly women. This incident spotlighted the dangers associated with artisanal mining in Mali, exacerbated by the collapse of an abandoned site previously operated by a Chinese firm. Notably, this was the second deadly mining accident within three weeks in the region, as a previous flood in a mining tunnel claimed 10 lives.
In response to these tragedies, the Mali government has taken decisive actions, including seizing equipment utilized in small-scale mining operations and dismissing local officials linked to these incidents. The government’s focus now includes enhancing safety regulations to avert future mining disasters.
Mali’s leadership, since the military coup in 2020, has sought to reform the mining sector to bolster state revenues from gold production. An audit revealed significant tax evasion by multinational corporations, prompting President Goïta to revise the mining code. This reform aims to renegotiate contracts and could potentially unlock more than $1 billion in revenue for Mali.
Currently, Mali’s mining operations are significantly influenced by foreign companies such as Barrick Gold and B2Gold. However, the sector faces ongoing challenges, including disputes with foreign firms and tax evasion issues. The anticipated reforms could yield an additional $950 million annually, which is around 20% of Mali’s national budget. Economy Minister Alousseni Sanou stated that these new revenues are essential to addressing internal and external debt while supporting military procurement.
Mali’s recent suspension on mining permits for foreign companies reflects an urgent need for enhanced safety measures following tragic accidents in the sector. The government’s reforms aim to increase state revenue from gold production, tackling issues like tax evasion while navigating challenges with foreign investments. The outcome of these measures could significantly impact Mali’s economy and safety standards in mining.
Original Source: africa.businessinsider.com
