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ECOWAS officials meet to discuss Africa Mining Vision
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Public Officials from the Economic Community of West African States (ECOWAS) are meeting here in Accra to discuss the Africa Mining Vision (AMV) and the ECOWAS Mineral Development Policy (EMDP).
Ben Aryee, Advisor to the Minister for Lands and Natural Resources observed that the fiscal regimes on the African continent were not generating enough revenue for their respective economies.
He emphasized mining has the potential of contributing to the growth of economies but little has been achieved in the sector.
“We are not going to get different results if we continue to do the same old things with regards to how we have conducted affairs in the mining sector,” Aryee said.
Associate Economic Affairs Officer, Special Unit on Commodities of the United Nations Conference on Trade and Development (UNCTAD), Komi Tsowou said China has become a dominant force regarding the importation of minerals from Africa.
Speaking on the topic, “Global mineral commodity trends and their implication for Africa”, Tsowou observed that “China is increasingly becoming important in the mining sector on the continent as it is the leading importer of global commodity markets.”
The Asian country between2011-2012, he noted imported between 60 and 30 percent respectively of iron ore and copper from nearly 10 and 5 percent in 1995-1996.
Similarly, exports of minerals, iron ore and metals (MOM) from ECOWAS countries to developing countries, especially China he emphasized, have increased significantly between 2003 to 2013.
This situation, he noted creates a win-win situation for both sides as China gets minerals for its industrial use while African countries are able to access natural resource backed loans for developmental projects.
Tsowou observed that MOM price trends and commodity performance in resource rich countries within the ECOWAS sub-region led to improved economic performance, high correlation between commodity prices, export earnings and economic performance but said: “the transmission of these windfall gains to a path for sustainable socio-economic development has not been successfully achieved”.
Poverty levels on the continent, according to him were still high in spite of the increased Foreign Direct Investment (FDI) inflows to Africa.
The limited benefit from the resource boom on the continent he said could be attributed to highly volatile and unpredictable commodity prices, low value created at domestic levels, unequal distribution of resource rents, and vulnerability to high prices as well as the resource curse.
The UNCTAD Associate Economic Affairs Officer urged African government to as part of the short to medium term policy options adopt a strategic and policy development, increase the shares of the rents generated commodity production vis-à-vis revising existing investment or mining contracts, more efficient form of taxing extractives industries such as progressive taxation.
Others are to adopt policies to retain values locally, targeting a broadening and deepening linkages to the upstream, sidestream and downstream from commodity production as well as to put in place a win-win local content policies.
On the medium to long term measures, Tsowou advised African countries to adopt policies that would harness windfall gains from high MOM prices in the way that facilitate wider economic transformations and boost economic growth that was not driven by commodities alone and to invest in sovereign wealth funds to cope with instability in global commodity markets as well as to smoothen inter-temporal imbalances in domestic spending and revenues.
Coordinator for Third World Network, Dr. Yao Graham said his organization was committed to promoting a reform agenda aimed at optimizing the development value of Africa’s minerals whilst strengthening democratic accountability in decision making and responsiveness of states and companies to the conditions of mining communities and workers in the sector.
The rationale for the two-day workshop he noted was about knowledge sharing on how to transform the role of minerals in the economies of African countries.
Participants for the workshop are drawn mainly from a number of institutions in the main mining countries in the ECOWAS sub-region.
They include senior officers from mining and trade and industry institutions and leading members of mineral policy committees in the legislatures and the Africa Mining Development Centre.
The goal of the workshop is to contribute to making the AMV and the EMDP the strategic drivers of mineral and development policy in the ECOWAS sub-region.