Rwanda: Govt-Private Sector Partnerships Could Solve Mining Industry Issues

The article "Shortage of skilled manpower, limited funding hurt Rwanda's mining industry" published last Tuesday touches on the main problems facing development of mining industries in most developing African countries that are gifted with favourable geological environments.

I consider governments' reluctance to invest in the discovery of mineral occurrences and the value addition exploration to establish inventories of mineral potential and deposits a root cause of the other problems facing development of mining sector in the mineral-rich African countries like Rwanda.

Without such inventories the governments won't be able to plan development of infrastructures for mining support and training of mineral professionals. It would also be very difficult to attract private sector investing and optimise optimal development and utilisation of mineral resources in terms of integration with other sectors of these economies; and maximisation of local benefits.

Public-private sector partnerships could be the most effective option for the government to invest the establishment of mineral inventories, thanks to the progressive management, skills and methods in exploration the partnerships would obtain from private sector.

Regional collaboration is important in the establishment of effective local training capacity which is well furnished with the essential training materials born from regional funding and adequate practical training obtainable from all regional mining sites. That is, a regional training capacity which is focused on quality rather than quantity.

For instance, Tanzania is already producing highly qualified exploration geologists who could have contributed a lot in the discovery of new mineral occurrences and deposits through self-employment. Unfortunately, this is not happening because the government does not support them.

If graduating geologists want to venture into exploration through self-employment, they must pay the same exploration licence fees the well-funded foreign explorers are paying, which these new graduates cannot afford. It is important to note that high exploration licence fees are counterproductive and unjustifiable, especially for the mostly Greenfield exploration going on here.

Again, local financiers like banks and social security funds are missing important investment opportunities in local exploration and/or mining, not only due to fear of high risks, but mainly because they are not equipped with world-class expertise in exploration and mining business and investing.

Such expertise would mitigate risks through optimal selection of investment targets and management of exploration to realise results at minimal cost.

I however find agitation for low taxes unacceptable because it means evolution of a poor-quality mining industry, which contributes less to local economies. Instead, miners should requested governments to provide cost-competitive infrastructure like in power supply, water and transport for mining support; replacement of social responsibility with a mineral levy (or mineral royalty) payable to the local communities; and reduction of exploration fees.

Yes, increased training of Rwandans in mineral skills (especially in mining and processing) is timely not only for the local demand but, for regional demand as well because Rwanda is on the 'middle of regional mining in East and Central Africa. However, it essential to send the trainees to the best mining schools in South Africa, Zambia, Australia and Canada, where the sector is well-developed and thriving.

Source :

Posted on : 30 Nov,-0001

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