For Africa to advance its beneficiation and processing industry in a manner that will support growth, assure a return on investment and stimulate local economies, the continent will have to find a way to connect various elements of the decision-making process and stakeholders, says information technology company Cactus Investments CEO Tresor Chovu.
As no one stakeholder can build the processing industry, he emphasised the importance of industry players – mining companies, investors and governments – “joining hands” in providing facilities to build a tax base and apply import duties while the government provides land and assists in creating an amicable environment for this development.
However, Chovu said this process had to start with the local policies in African countries, which then need to be implemented to assist people and companies in developing the processes.
During a panel discussion at this year’s virtual Africa Mining Forum, on November 17, he said government and mining companies had to provide a lot of support, “because there are various issues to address”.
While he referred to the availability of electricity being a challenge, he also elaborated on the financial sector, which is “sometimes very weak”, and urged mining companies to “go the extra mile” with their expertise when helping local communities to build processing plants.
“It will take effort from the mining companies and the governments to work jointly to reach the common goal,” he said.
This is a challenging balance to find, Chovu added, noting that, on the one hand, a beneficiation operation is required to run well and have good revenues, but, on the other hand, companies also need to be allowed to recover their investments.
It is for this reason that he suggested countries and mining industry players be “less rigid” when it comes to policies and that they should rather “change the way [they] respond to the market”.
“We need to be more responsive to policies according to what is happening in the markets, and we also have to look at how to promote beneficiation to friendly financial institutions in order for African countries to boost the export market. It needs to be driven by the finance sector, and sometimes it’s weak internally,” he elaborated.
He suggested setting up guaranteed bonds for local players, as an example, to assist the financial markets being more at ease with the associated industry risks.