Fed tests gold upleg
Gold’s outlook and fundamentals remain really bullish.
Mali’s interim President Assimi Goita has signed into law a new mining code which will allow the military-led government to increase its ownership of gold concessions and recoup what it says is a major shortfall in production revenues.
The new code, signed on state television late on Monday, will allow the state and local investors to take stakes as high as 35% in mining projects compared with 20% now, and could more than double the sector’s contribution to gross domestic product to around 20%, the government has said.
It was not immediately clear if the code would affect existing projects. A mining ministry official said last week that this would depend on the implementing decrees, which have not yet been made available.
Mali is one of Africa’s top gold producers and is home to mining companies including Barrick Gold, B2GOLD, Resolute Mining and Hummingbird Resources.
Mali’s Finance Minister Alousseni Sanou said on Monday evening that an audit of the mining sector had shown that the state was missing 300 billion to 600 billion CFA francs ($497 million to $995 million) which it intended to recover.
“The shortfall is around 300 to 600 billion CFA. So if the facts are established, it will be a question of re-negotiating what is renegotiable and recovering what is recoverable,” Sanou said on state TV.
“When we go into negotiations with the companies, it is possible that we will obtain 300 to 400 billion,” he said.
Mining Minister Amadou Keita said that some state losses have been caused by mining companies taking their gold ore to a different, tax-exempt mine to be processed, and that the new code would crack down on this.
He also said that greater attention would be paid to the issuance of mining titles.
“From now on, for the sake of transparency and inclusiveness, mining titles will be signed by several ministers (finance, mining, environment, etc.),” he said on state TV.
Goita overthrew two presidents in 2020 and 2021 in coups driven by frustration at the handling of an Islamist insurgency, which has only worsened since his military government took power. He has said he will organize elections and restore power to civilians in 2024.
($1 = 603.2500 CFA francs)
(By Tiemoko Diallo and Nellie Peyton; Editing by Sharon Singleton)
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