The Mines and Money Access Africa Summit 2014 hosted a pre-conference session at the Intercontinental Hotel in Balaclava on Monday June 23, 2014 themed ‘Mauritius- Gateway to Africa’, with more than fifty local and international participants.
The workshop offered delegates an overview of how to use Mauritius to optimise and safeguard Africa-directed investments, and at the same time to identify both Mauritius and Johannesburg listing opportunities.
Organized by Mines and Money and co-hosted by the Board of Investment Mauritius, the event is sponsored by ABAX, Intercontinental Trust Limited, The Lind Partners, and AfrAsia Bank Limited.
Representatives of several Chinese companies are attending the event, including China Guangdong Nuclear Power Group Uranium Company, China Railway Materials Company Limited, China Jinchuan Investment Holdings Company Ltd, China Mining United Fund, China Investment Corporation, CNNC International Ltd, China Power Investment Corporation, Shenhua Overseas Development and Investment Company Ltd, China Nonferrous Metal Mining, and Chinalco Mining Corporation International.
The main objective of the conference is to take advantage of Mauritius’ investment protection and tax treaties while meeting with Asian investors and mining companies in a neutral location.
The Chairman of the Mineral Policy Committee at the Southern African Institute of Mining and Metallurgy, Michael Solomon, spoke about managing risks in Africa.
Michael Solomon stated that Africa is an ethical place to operate and, despite the environmental issues surrounding extractive activities, the mining industry has the support of the society.
“Before investing in any mining venture, you should look, first and foremost, at the cost curve which varies according to the market dynamics,” Michael Solomon said.
Moreover, investors entering the mining sector should be ready to understand that demand dynamism is not the same in every country.
The political economic issues facing the mining sector are the dependence of emerging commodity suppliers on developed economies, the emergence of the Development State – conflicts of economies and cultures, lack of effective governance and the new models of minerals driven by economic development, monetary policies, cross-sectoral economic benefits and need for resource security.
Besides, he mentioned that resource nationalism is the biggest problem plaguing the mining industry.
“Increasing pressure to extract greater rents from the mining industry is the function of a global trend in resource nationalism. I use this term to describe the desire of people in resource-rich nations to derive increasing economic benefit from natural resources,” he said.
In addition, resource nationalism addresses the resolution of the governments to exercise greater control of their respective countries’ non-renewable natural resource sectors.
Shamin Sookia, head of listing at the Stock Exchange of Mauritius (SEM), spoke about the SEM as an attractive and competitive capital-raising platform for mining and exploration companies.
“Mauritius acts as a service platform which is poised to allow investors to use the country and its benefits to pursue their projects in Africa,” he noted.
He highlighted that the global business sector in Mauritius presently registers flows amounting to billions of dollars, and the SEM provides the platform to structure tax-efficient vehicles in the Mauritian global business sector to capture these capital flows.
Patrycja Kula, a Business Development Manager at the Johannesburg Stock Exchange (JSE), spoke about the JSE, highlighting the advantages it offers investors: a secure and efficient market place, access to deep pools of capital both local and foreign, and a large debt market by less value traded.
“South Africa investors are not constrained to invest in only local companies but they also have the option to invest in foreign companies listed on the JSE,” she underlined.
She added that 369 billion rand have been invested, ensuring high liquidity for mining investors.
Furthermore, she emphasized that South Africa improved its global position in the FDI confidence index from 15 to 13 in 2014 and, of the 387 companies listed on the JSE, 66 are basic resource ventures such as mining firms.
This pre-conference event will be followed by a two-day conference held at the Intercontinental hotel from June 24 to June 25, 2014.
Image (Cecilia Samoisi): Patrycja Kula, a Business Development Manager at the Johannesburg Stock Exchange (JSE), emphasized that South Africa improved its global position in the FDI confidence index from 15 to 13 in 2014.
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