african mining vision

Communications WorkshopLilongwe, Malawi – May 2016

Daisy Diamante LeoncioCommunications OfficerAfrican Minerals Development Centre (AMDC)

Africa Mining Vision

Presentation outlineI. Africa Mining Vision

II. Background

III. Vision

IV. Challenges and Success Factors

V. AMDC

VI. Work Streams

VII.Activities

Africa Mining Vision• Adopted by African Union Heads

of State and Government in February 2009

• Understand of value beyond mineral revenues

• Harness mineral resources to accelerate development

• Build resilient, diversified, and competitive economies

Envisioned to:

• Botswana – Home to 35 percent of Africa’s diamonds, gem quality. Produces copper, gold, nickel, etc.

• Democratic Republic of Congo – Estimated to have more than $24 trillion worth of untapped raw mineral ore deposits. One of the greatest producers of diamonds (34 percent) and copper (13 percent) in Africa.

• South Africa - enormous mining industry. World’s largest producer of chrome, manganese, platinum, etc.

• Tanzania – fourth largest gold producer in Africa, also has deposits of iron ore, nickel, copper, cobalt, silver, etc.

Africa – a cut above the rest

Africa – a cut above the rest• Namibia – 46 percent of the continent’s uranium stashes• Mozambique – critical producer for aluminum, with 32

percent of Africa’s supply.• Zambia - produces 65 percent to 77 percent of Africa’s

copper supply.• Guinea – more than 95 percent of Africa’s bauxite

production.• Ghana – export trade is significantly bolstered by its mineral

riches — 37 percent of total exports are minerals. Ghana is Africa’s second-largest producer of gold after South Africa, and holds more than 15 percent of the continent’s supply..

Africa – a cut above the rest• Hosts 30% of world reserves of

extractive resources• Produces over 60 different type of

metals, ores and minerals • Encompasses the whole continent• Half of the countries regard mining

as an important economic activity• Produces minerals for

international market outside the continent

The Paradox

Massive amounts of natural resources

Socio-economic develop-ment

Economic Landscape

The Paradox• Triggered calls for resource-driven development• Paved way for a new developmental approach in which

mineral resources would play a catalytic role for economic transformation and development

• AU adopted the AMV as continental framework to drive the vision

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Enabling mineral resources to play a greater transformative role in the development of the continent

AMV – Structural Shift• Creates sustainable and well-governed mining sector • Resources to be invested in other forms of lasting capital that

can outlive the currency of mining• Safe, healthy, gender and ethnically inclusive• Environmentally-friendly• Socially responsible• Appreciated by surrounding communities

Critical Constraints and Success Factor

The level/quality of the resource potential data:Most African states lack basic geological mapping or, at best, are poorly mapped. This increases the risk for investors who consequently demand extremely favorable tax regimes for any operation that may result from their blue-sky exploration.

Contracts negotiating capacity:Need to improve the capacity of African states to negotiate with the resource TNCs on the resource exploitation regime.


Ongoing African resources development and governance capacity:Creating African capacity for ongoing auditing, monitoring, regulating and improving resource exploitation regimes and developing the resource sector linkages into the domestic economy.


Capacity

The key element in determining whether or not a resource endowment will be a curse or blessing, is the level of governance capacity and the existence of robust institutions.

However, this could be a “chicken and egg” situation for African states, in that they are underdeveloped precisely because they have weak governance and institutions.


Addressing Africa’s infrastructure constraints:Lack of the requisite infrastructure (especially transport and energy) to realise the natural resources potential.

• Africa’s relative logistics costs are about 250% of the global average because Africa is the highest continent (has few navigable rivers) and 93% of Africa is in the tropics (ITCZ16, high precipitation), resulting in a greater cost of infrastructure provision

• Incoherent European balkanisation resulted in many African states being landlocked (14);


Addressing Africa’s infrastructure constraints:Lack of the requisite infrastructure (especially transport and energy) to realise the natural resources potential.

• Africa has only 10% of land within 100km of coast (cf. 18% OECD & 27% Latin America); and Only 21% of its people live within 100km of coast (cf. 69% OECD & 42% Latin America).

• Due to this constraint, the resources of many African states are “stranded” and cannot currently be exploited, as individual projects cannot afford to absorb the huge costs of the necessary infrastructure due to insufficient rents.

Critical Constraints and Success FactorsThe case of artisanal and small-scale mining (ASM):

• ASM provides 13 to 20 million jobs worldwide while a further 80-100 million depend on it for their livelihoods.

• In Africa, about 3.7 million are directly engaged in this sub-sector and about 30 million depend on it. It is an expanding sub-sector predicted to triple by 2012. ASM is labor-intensive and provides more employment than large-scale mining.

• Between 15 to 20% of the world’s non-fuel minerals, approximately 18% of Africa’s gold and almost all of the Africa’s gemstones, except diamonds, are produced by ASM.

Country Mining Vision

CMV – Migrating AMV at the Country LevelTool to facilitate domestication of the AMV

• Alignment of national policies to the AMV

• Restructuring of legal and regulatory frameworks

• Involvement of broad range of stakeholders (civil society, parliamentarians, communities, business, government, journalists)

• Bottom-up, top-down process rooted in collective national ownership

CMV – Guided by the AMV Action PlanKey Focus Areas

• Fiscal regime and revenue management

• Geological and mineral information systems

• Building human and institutional capacity

• Artisanal and small-scale mining

• Mineral sector governance

• Linkages, investment and diversification

• Environment and social issues

• Communication and outreach strategy

AMDC was launched in 2013

Implementing Partners

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Enabling mineral resources to play a greater transformative role in the development of the continent

AMDC Mission

Working with member States and their national and regional organizations to enable mineral resources play a greater transformative role in the development of the continent through increased economic, social linkages and improved governance.

Priority Areas

• Technical support

• Gap analysis and alignment of Member States policies, regulations and institutions with AMV

• Policy research and recommendations for implementing AMV

• Advocacy, communication and information dissemination around the AMV

• Think tank capacity for embedding the AMV in Africa’s long-term development agenda

• Lack of awareness about AMV and ownership by countries

• Multiplicity of partners and lack of coordination in countries

• Transition of AMDC to an AU Specialized Agency

Challenges and Opportunities

Work Streams or Pillars

1. Policy and licensing

2. Geological and mining information systems

3. Governance and participation

4. Artisanal and small-scale mining

Work Streams or Pillars

5. Linkages, investment and diversification

6. Human capital and institutional capacities

7. Communication and advocacy

Policy and Licensing: to enhance policy design within institutional frameworks.

Kingdom of Lesotho

• Technical support drafting process for Lesotho’s new mining legislation.

• The consultative process and national stakeholders’ workshop.

• The draft bill is now ready and will be subjected to national consultations, then presented for parliamentary deliberation.

AMDC’s Work


Review of policy and regulatory frameworks in EAC African countries

• The study to review policy and regulatory frameworks in the East African Community for alignment with the AMV, was completed and submitted to the member states for review.

• Rwanda’s Ministry of Natural Resources has agreed to host an expert group meeting to review the findings of the study and draw out a framework to support EAC member countries to align their mining laws

AMDC’s Work

Harmonizing the governance framework of the extractives sectorAddis Ababa, March 2016

AMDC’s Work


Regional Sharefair on Gender Equality in Africa’s Extractive Industries Sector

• AMDC provided support on sharing knowledge, promoting innovation, good practices, legal frameworks and policies and exploring opportunities for networking, advocacy and capacity building in support of women in the EI.

AMDC’s Work

Geology & Mining Information Systems workstream is “to improve geological and geospatial information and its use in mining and broad development processes in Africa.”

Desktop Review of African Geological Survey Organization Capacities and Gaps- a publication prepared by the AMDC to provide key insights on the relationship between minerals and development. The review assessed the effectiveness of geological support and illuminated potential traps.

GMIS Strategy Development- proposed to facilitate the strengthening of the African production, management and dissemination of geological and mineral information (GMI).

AMDC’s Work

Geology & Mining Information Systems workstream is “to improve geological and geospatial information and its use in mining and broad development processes in Africa.”

Deep-sea Mining- assisted the International Seabed Authority in preparing its Mining Code for the exploitation of mineral resources from the international seabed area.

African Blue Economy Policy Handbook- technically assisted and co-sponsored the elaboration of the African Blue Economy Policy Handbook. It covers all maritime spaces and shows the underwater mining and related activities as essential for African broad-based development.

AMDC’s Work

AMDC as premiere expert on Geological Mineral Information SystemsDar es Salaam, Tanzania, March 2016

AMDC’s Work

Governance & Participation workstream is “to create a mining sector that is environmentally and socially responsible, and appreciated by all stakeholders including surrounding communities.”

AMDC’s Work

Country Regional GlobalGhanaGuineaKenya

LesothoMalawi

MaliNiger

Sierra Leone

Support to COMESA’s mineral beneficiation agenda through beneficiation study initiated in the SADC region (15 member states).

SADC mining sector skills mapping.

Exploring options for collaboration with the ICGLR Secretariat and OECD

African Mining Law Atlas (AMLA).

Strengthening Assistance for Complex Contract Negotiations (CONNEX) - and the G7-led initiative.

OECD Natural Resources Dialogue Initiative.

AMDC’s Work

Q3 - 2014 Q4 - 2014 Q1 - 2015 Q2 - 2015 Q3 - 2015 Q4 - 20150

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Figure 2: AU Member States where CMV initiatives are ongoing

Countries with AMV as the leading mineral sector governance framework Countries with non-AMV policy actors as leading mineral sector governance frameworkCountries requesting AMV/CMV as overarching mineral sector gov't framework

AMDC providing technical assistance to Sierra Leone GovernmentAfrican Union, Addis Ababa, Ethiopia, December 2015

AMDC’s Work

The Linkages, Investment & Diversification workstream aims “to create an investment-friendly mining sector that is a key component of a diversified, vibrant and globally competitive industrial African economy”.

Mineral beneficiation studiesFinalized multi-country study reports on the challenges and opportunities for leveraging the potential of linkages along the mineral value chain.

Finalized a technical proposal on Engaging the Private Sector for Inclusive Extractive Industries and Sustainable Value Chain.

Fiscal Linkages Finished a study on the impact of illicit financial flows on domestic resource mobilization from the minerals sector.

Commodity- Based Industrialization

The workstream also led the drafting of the EI case studies for the UNECA’s flagship Economic Report for Africa 2016 on Greening Industrialization.

Africa’s Commodity Strategy

To further harness synergies in the natural resource development strategies, the AUC has drafted a continent-wide development framework, targeting soft and hard commodity sectors.

Neglected Development Minerals

The Africa Mining Vision as part of its paradigmatic shift, calls for the harnessing of the transformative potential of all minerals including those often neglected because of their low commodity value.

AMDC’s Work

The Human and Institutional Capacities workstream aims “to create a mining sector that is knowledge-driven and is the engine of an internationally competitive African industrial economy”.

Development Account Project on Contract Negotiation in the Extractive Sector Implemented a project “Strengthening the capacities of African governments to negotiate transparent, equitable and sustainable contracts in the extractive industries (IE) for broad-based sustainable growth and socio-economic development"

CONNEX InitiativeWorked with various stakeholders to align global initiatives with AMV principles, in particular the G7 led CONNEX initiative.

AMDC’s Work

The Communication & Advocacy workstream aims “to improve social and economic development options through a free flow of information among all stakeholders around the AMV, AMDC and mineral-based transformation”.

Increase access to information and knowledge packaging

- CMV communications workshops

- Integrated knowledge management and communications strategy

AMDC’s Work

Mining IndabaCape Town, South Africa, February 2016

AMDC’s Work

For more information:

www.uneca.org/amdcwww.africaminingvision.org

Africa Mining Vision

http://www.uneca.org/amdc

african mining vision

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