Lonmin CEO Ben Magara
CAPE TOWN (miningweekly.com) – The move towards green technology has provided tremendous opportunities for platinum-group metals (PGMs), which offer significant benefits for the African continent, says Lonmin CEO Ben Magara.
Speaking at the Bloomberg Africa Business and Economic Summit in Cape Town, he pointed out that 80% of the world’s PGMs, as well as 80% of the world’s manganese and chrome reserves, were in Africa.
“We are going to have to mine it [and that] excites me,” he told summit delegates.
Magara said the doubling of Africa’s population between now and 2050, coupled with gross domestic product growth, heralded great opportunities and would consistently ramp up the number of vehicles needed on the continent.
He said there were 800 vehicles for every 1 000 people in the US, with 130 vehicles for every 1 000 people in China. In Africa, there were 86 vehicles for every 1 000 people.
“The prospect of vehicle growth, which drives the platinum industry, could boom, and Africa’s youthful growth is absolutely critical,” he said.
Magara added that the countries that would make it were those that were “getting off their butts”.
“We know what to do, and then we do nothing. Those countries that are getting up and doing it, are succeeding, like Rwanda, Kenya and Ethiopia. Inaction will weigh down on those countries that are not succeeding.”
The summit heard that middle-class growth in certain countries would spark growth. Middle-class growth in Nigeria, for instance, is poised to soon outpace that of China.
Old Mutual chairperson Patrick O’ Sullivan said Old Mutual was also planning to expand its ventures in Africa. He added that his company was in a joint venture with a Kenyan telecommunications firm to sell life and savings products on mobile phones.
O’Sullivan further noted that governments were changing and developing regulatory systems that were “much more beneficial” to people in financial services. People were able to deposit as little as one Kenyan shilling in an account.
“If you can save one shilling at a time on your mobile phone, that’s a whole different ball game to what’s experienced in the developed world,” he said.
Bloomberg chairperson Peter Grauer said data was becoming increasingly important in the global economic community.
“Data is king. People want to see as much information at they can prior to making a decision. Data is how investors keep score.”
Fighting corruption was also vital and some countries were making serious headway, such as Côte d’ Ivoire. Millennium Challenge Corporation CEO Dana Hyde said Côte d’Ivoire had taken steps to seriously tackle corruption and was now one of the fastest-growing countries on the continent.
She said there had been a major move from aid to trade and investment on the continent. While official development assistance used to consume 60% of the capital flows into Africa, it had now dropped to below 20%. Money going towards aid was being replaced by remittances, foreign direct investment and domestic private sector investment.