Nigeria v Other African Countries10 Nov 2024 09:48
For some is easy to qualify every African country under the same risk category, and yet when one take a look at the real facts like, cash left for shareholders and tax regimes, there are many distinctions and differences to highlight.
But beside numbers also under the political aspect many African countries are following a different trajectory whit their policies and indeed internal affairs.
IMO, the recent intervention of the Central Gov. to mediate the crazy hysterical action of Osun state, send a clear sign that Nigeria wont allow its nascent mining industry to be derailed by actions from single lunatic politicians. These recent events about local gov. trying to extort money from foreign miners as no precedents and unfortunately Thor find it self been the first having to set precedents for the rest of the industry to follow. I am very hopeful that the Nigerian Central Gov. is well aware of this, if they want to luce foreign investments in the mining sector.
Especially I am curious to see how the Osun state is going to square up claims of environmental "disasters" when all permits and checks have been granted by Env. Minister from Central Gov.
But going back to the difference in taxation and gov. interference in different African countries, just think of this case scenarios, for comparison. Mali, company called Allied Gold, Has been trying to mine a high grade satellite pit for moths awaiting the gov to grant permit. Mali said no sorry, first we have to agree on new mining law...after months Allied Gold had to pay out a fortune if they wanted to keep operating in that country.
Last 3 month result showing a hole of some $120 millions, in stead of a profit.
I know is easy to classify every African country under the same risk, but IMO Nigeria is way above many other counties like Mali, Congo, Burkina Faso, CAR, and many other.
Again recent actions show that Nigeria Central Gov. will be actively making sure it become more like South Africa`s approach to mining that like Mali.
Lastly even if a little cynical, we need to take in consideration that many African counties that resort to milk foreign miners, with new taxes and concessions are counties that beside the geopolitics are also very poor, they had recently a change of faith in the government like a coup and have serious issues with militants violence and terrorism.
Nigeria is very much an established democracy, relatively heathy society, (My Nigerian friend just bought the 7th flat in Lagos) and they have a moderate ideology, I am sure in time they will also develop a great mining industry, possibly taking the opportunity and advantage to become one of the most friendly country in Africa for foreign investments. This will be evident with Thor coming financial results which will show a massive cash net profit, when some other gold miners out there, even with POG at these levels are struggling to make a profit.
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