The African mining industry offers unparalleled opportunities for both national and international investors.
Africa is home to an abundance of natural resources including diamonds, gold, oil, natural gas, uranium, platinum, copper, etc. The continent hosts 30% of the world’s mineral reserve and due to its low local human density, a large aspect of this mineral wealth is untapped and yet to be discovered.
Africa supplies 55% of the world’s diamonds, leading producers being Botswana and Congo. Gold mining comprises of 60% of the mining industry in Africa, with the continent producing 22% of the global gold production.
Rising demand for mineral commodities has increased the prices for many metals such as aluminium, copper, zinc, lead, nickel and tin. This has subsequently increased the growth rate and revenue of the mining industry.
2017 seems to be a profitable year for mining with South Africa’s mining production rising to 15.5% year-on-year, making it the highest growth rate in 2 years. Mining production growth was driven by industrial and precious metals with platinum production rising by 4.8% month-on-month and iron-ore by 1.5% month-on-month.
The growth of the mining sector is also a key source of job creation in Africa. Mining activity occur in majority of the African countries and mining companies employ 3.7 million people. Artisanal and small-scale mining employing another 25 million people. This growth cumulatively translates in many new jobs in the supporting industries linked to the mining sector.
There has been a steady rise in Foreign Direct Investment projects in African Mining and with further policy reformations and infrastructure development, mining continues to entice investors to opportunities. Southern Africa’s FDI has increased to almost while Central Africa has risen to approximately 22.4%.
The International Council on Mining and Metals (ICMM) has helped to frame the agenda for sustainable mining and provides guidance on key issues for the sector. Sustainability is also becoming a central to the African with several mining sector African mining countries reforming their laws requiring the extractive industry to actively engage with the local communities and abide by the environmental regulations as part of their operating strategy.
Development and growth in the African mining sector has improved vastly after the implementation of The Africa Mining Vision in 2009 to ensure mineral resources are utilised strategically for broad-based, inclusive development. A lot of countries including Zambia has benefitted from this framework.