With commodity prices improving and the mining industry moving towards positive growth, indications are that participants at the Investing in African Mining Indaba 2018 will experience the “return of investor appetite” first-hand, says Mining Indaba MD Alex Grose.
This renewed investor interest suggests that the African mining sector is likely to benefit from increased investment this year, with African Minerals Development Centre (AMDC) acting coordinator Dr Kojo Busia noting that improving economic conditions globally are providing momentum for the mining industry in most African countries. “Investments have been growing at a sustained rate, as commodity prices have stabilised.”
He states that, as investment decisions require information that is as comprehensive and as accurate as possible, “the Mining Indaba remains the pulse of the mining industry in Africa because it gauges governments’ policy orientation and trends in the industry”. Busia adds: “This is crucial to ensure proper planning and forecasting from all stakeholders.”
Grose points to political and legislative changes in many African States, noting that investors have a greater need to understand the risks and opportunities involved in investing in African jurisdictions.“We have over 25 African Ministers at the event. Obviously . . . Tanzania, Zimbabwe and South Africa are top of mind at the moment, but there is a lot of interest in the rest of the continent.”
He highlights that the conversations that take place between the various stakeholders at the Mining Indaba are vital to the development of the African mining sector. “If we get these conversations right, it could mean billions of dollars of investment heading to Africa.”
Those involved in organising the event feel a “huge responsibility towards the African mining industry”, Grose states. He stresses that the Mining Indaba is the only international mining platform that caters to all the stakeholders involved in investment decisions. “That is why we attract people from every part of the industry. That is why we attract more investors than any other event in Africa. The only stipulation is that participants discuss projects in Africa . . . to drive investment in the continent.”
Furthering the African Agenda
The AMDC – temporarily hosted by the United Nations Economic Commission for Africa (UNECA) – acts as the implementing body for the African Mining Vision (AMV), a socioeconomic development plan adopted by the African Union in 2009, explains Busia. He adds that the AMDC will soon move from the UNECA to the African Union Commission and be hosted by a member State.
“Given industry’s renewed optimism and its reorientation in line with the outlook for the minerals sector, it is important for stakeholders to address the institutional environment for mining in an African context,” he says, with specific reference to mineral value chains, value addition and growth opportunities.
Busia explains that the AMV is a developmental-mining approach that prioritises growth through the building of economic and social links to benefit the continent.
The AMDC has, in facilitating the implementation of the AMV, provided technical support services for countries, including formulating forward-looking policies, strategies and legislation.
Busia says the AMV and business interests are closely aligned as, “like the AMV, mining companies are playing the long game . . . establishing lasting and predictable institutions remains an area of mutual interest”.
Thus, the business community’s buy-in is integral to the success of the AMV. “The AMDC’s participation in the Mining Indaba allows for collaborative partnerships with governments, the private sector and other stakeholders. The event also serves as a platform for continuous dialogue to propel the shared benefits of the AMV.”
He notes that the AMDC has been active at the Mining Indaba for years and that the event has paved the way for the formulation of initiatives such as the Private Sector Compact, which defines the business benefits that the private sector will derive from the AMV’s implementation and can contribute to strengthening companies’ social licence to operate.
The implementation of the AMV requires political leadership and commitment from governments, as well as ownership and participation from mining companies. “The Mining Indaba is essential in facilitating engagement between these stakeholders and furthering the goals of the vision,” Busia states.
More than Just Mining
Speaking on the event’s impact on African economies, particularly South Africa’s, Western Cape Minister of Economic Opportunities Alan Winde describes the event as “an immensely important business platform”.
He adds that the event’s impact on the Western Cape economy has, besides others, come in the form of boosting tourism and that it was against this background that the Western Cape government decided to invest in the establishment of the Cape Town International Convention Centre (CTICC).
“When we built the CTICC, the idea was that it would become a destination for internationally renowned conferences such as the Mining Indaba. Cape Town had always been seen as a leisure tourism destination . . . but over the years, it has increasingly been viewed as a business tourism destination as well – in part because of the success of the Mining Indaba.”
In Winde’s 2013 statement welcoming Mining Indaba delegates, he noted that the CTICC had contributed nearly R20-billion to the country’s gross domestic product (GDP) prior to 2013. He tells Mining Weekly that the CTICC’s GDP contribution has increased to R22-billion since 2013.
Further, although he is unable to provide the exact number of jobs attributed to the success of the Mining Indaba, Winde notes that “a large number of first-time visitors come to Cape Town because of the Mining Indaba,” with many of them returning with their families or to explore potential business opportunities.
The CTICC has, therefore, had a significant impact on the creation of tourism jobs, which increased by about 60 000 in 2017. “There are now about 300 000 tourism jobs in the Western Cape . . . Further, international arrivals to Cape Town increased by 27% last year.
“The influx of tourists creates a pipeline for investment in the region.”
Numerous fringe events take place before and after the Mining Indaba and have become a means of deriving investment for African economies, Winde adds. Many of these conferences take place outside South Africa and their success could have similar impacts on the economies of the host cities.
Back to Basics
Grose notes that Mining Indaba initiated a series of changes to the 2017 event to take it “back to its roots and meet the changing needs of the industry”.
Although the initial premise of the Mining Indaba was to bring together corporates, investors and governments, he admits that “. . . it’s fair to say that . . . we had [perhaps] moved away from that”.
Grose adds that the organisers’ self- correction has been successful, as participation by investors and mining corporates in 2017 increased by 71% and 41% respectively.
As part of the organiser’s continual efforts to improve the overall experience, it has moved most of the existing activities into the main hall. “This . . . creates a real hub and generates buzz; it moves away from the traditional tradeshow approach, with rows upon rows of boring stands, and it ensures that the delegate experience is more focused.”
Grose adds that content has also been made more engaging through the creation of more segmented and “targeted tracks”, such as the Junior Mining Showcase.
“The agenda [will have] some significant changes in 2018. To start with, the main stage will host more interviews with industry leaders alongside the normal corporate presentations. The main stage events include a head-to-head clash on gold versus copper, as well as interviews with Russian diversified miner Norilsk Nickel’s chairperson and American aluminium producer Alcoa’s CEO.”
Grose says one of the main changes for 2018 is a focus on sustainability throughout the event. This means that, while the Sustainable Development Day will be held on February 6, sustainability- focused content will be featured on all the other days.
The organiser has also introduced an innovation-focused segment called Mining 2050 “to ensure that Africa is at the forefront of mining innovation – providing a meeting place for leading COOs, CIOs and chief technology officers to discuss what the mine of the future will look like”.
The entire event has undergone a makeover, says Grose. “A world-class event deserves a world-class environment and brand – we are very excited about the changes we are making to the look and feel of it.”
He notes that, unlike previous Mining Indaba organisers, the current Mining Indaba owner has the advantage of investing for the long term. “What that means is that we can really concentrate on what the focus of the event is, [as well as] who all our wider stakeholders are . . . enabling us to create the best event possible.”