Anglo American CEO Duncan Wanblad raises alarm over Mali’s new mining regulations, which demand higher revenue from companies and create an uncertain investment climate. Disputes, such as those with Barrick Gold Corp., highlight tensions between the Malian government and mining firms. Recent shifts towards Russian alliances and increased regulatory control reflect broader regional trends that could impact foreign investment in Mali’s mining industry.
Duncan Wanblad, CEO of Anglo American Plc, expressed concerns regarding the Malian government’s new mining regulations and their potential impact on foreign investment in the country, which is home to the second-largest gold mine globally. Following a military coup four years ago, Mali’s rulers have demanded increased revenue from mining operations, leading to new codes and significant back taxes. Wanblad emphasized that these developments create uncertainty for investors, highlighting the importance of stable fiscal policies in attracting long-term capital.
The government in Mali is currently at odds with Barrick Gold Corp., the second-largest gold miner worldwide. After issuing an arrest warrant for Barrick’s CEO Mark Bristow and detaining several executives, the military government is working to resolve disputes related to back taxes. While negotiations are ongoing, they are progressing slowly, according to Bristow, underscoring the tense relationship between mining companies and the Malian government.
In 2022, Resolute Mining Ltd. faced a crisis when its CEO was detained for a week pending compliance with Mali’s new tax demands, which were resolved after agreeing to pay $160 million. Other companies, including B2Gold Corp. and Allied Gold Corp., have established new agreements with the government that entail financial settlements and commitments to expansion projects. These actions reflect the shifting dynamics within Mali’s mining sector under military rule.
Mali has been aligning more with Russia, while severing ties with Western nations, coinciding with the deployment of Kremlin-backed Wagner Group mercenaries. This alteration in foreign relations might impact the operational stability and attractiveness of Mali’s mining sector for international investors. In nearby Burkina Faso, mining regulations have recently been introduced that impose stringent compliance requirements on foreign firms, further reflecting a growing trend of increased governmental control in the region.
Mali’s military government has been in power since 2020. Ongoing changes to mining legislation may endanger the country’s status as Africa’s second-largest gold producer and provoke further conflicts between the government and mining companies, hinder investment opportunities, and lead to a potential downturn in crucial economic sectors reliant on mining profits.
Mali is a significant player in the gold mining industry, being Africa’s second-largest producer. However, the political instability emanating from military rule has prompted substantial changes to mining regulations. The recent mandates from the Malian government include increased revenue demands and compliance with a newly instituted mining code, which could result in significant financial repercussions for mining companies operating in the region. The country has seen a shift in foreign relations, particularly a move towards Russia, which may further affect investment conditions.
The changes in Mali’s mining regulations, driven by the military government’s demands for increased revenues, create significant uncertainty for investors. High-profile disputes with major mining companies, coupled with the government’s pivot towards Russia and detachment from Western alliances, further complicate Mali’s investment landscape. Overall, these developments could jeopardize Mali’s gold production stability and attractiveness as an investment destination, emphasizing the need for regulatory predictability in the mining sector.
Original Source: www.bnnbloomberg.ca
