CAPE TOWN (miningweekly.com) – The World Bank has outlined a number of recommendations to help West African countries boost the level of local content in the mining industry.

Releasing a report on increasing local procurement in West Africa at the yearly Investing in Africa Mining Indaba gathering in Cape Town, World Bank operations officer Kristina Svensson said that these resource-rich countries should use mining to catalyse private-sector investment.

The report recommends that West African countries encourage mining companies to develop local procurement plans, which would assess their current situation and set realistic local procurement targets. Countries could also establish a supplier development fund to reinvest mining revenues back into smaller businesses.

Other recommendations include countries reviewing import tariffs and duties, which sometimes discouraged local procurement, and developing regulations that were not overly onerous.

Svensson said there was currently limited participation in the mining supply chain by local companies in West Africa, a problem compounded by differing definitions of what constituted local content, as well as poorly developed policies and legislation.

The World Bank considered local procurement in mining as an easy means to improve growth and development in West Africa, which held benefits not only for the countries, but also for mining companies. “For the mining companies the benefits would be reduced lead times, stock holding costs, it’s a more secure and customised supply and of course an enhanced public perception,” said Svensson.

Ghana has been identified as one of the countries currently making progress in encouraging mining companies in the endeavour of local procurement.

Ghana Mineral Commission CEO Ben Aryee said Ghana already identified the need to increase local content in the mining industry in the mid-1980s, but that the country was still on a learning curve.

Aryee noted that over the last three years a conscious effort has been made to move the process forward in a more structured way through legislation. Currently, the Ghanaian government was working with mining companies to assess their staffing situation in detail and to calculate the number of local employees as opposed to ex-patriots.

The issue of local employment is certainly key from the perspective of a mining company as it can have a direct impact on the sustainability of the mining operation, especially if situated in a politically unstable region, affirmed Rio Tinto global practice leader for communities and social performance, Bruce Harvey.

“Societal stability is what we all desire: governments, international agencies and large mining companies and others. Societal stability is actually dependent on full and meaningful employment … particularly for young people. When they’re not gainfully and meaningfully employed we all know what happens,” said Harvey.
 

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