On 5th September 2021, following the political unrest in West African nation Guinea, which dethroned President Alpha Conde, one working official from the Russian aluminium giant Rusal commented: “Political turmoil has not disrupted the mining sector as much as some had predicted. Everything is stable, business is going on. It's just a transition period we are going through."
Lieutenant-Colonel Mamady Doumbouya led military group have out-stretched their course of action to reassure foreign investors that they will ratify existing agreements.
The coup leaders proved themselves that they are not against any business by withdrawing curfew from the mining areas, which they implemented immediately after seizing power. The group urged mining companies to pursue operations and made sure that the nation's ports remain functional.
The leader Colonel Doumbouya met the executives of the mining companies, just after a week of the coup and provided them additional reassurance. However, on 27th September 2021, he released the road map back to democracy and civilian rule.
Paul Melly, an analyst from the London-based think tank Chatham House assumes “the military group mean what they say”. Chatham House, also known as the Royal Institute of International Affairs, is an independent policy institute.
Paul said: "The evidence is building up that they do seem to be committed to a serious transition that is focused on restoring good governance. Obviously, a part of that is maintaining a stable environment for investors."
Amadou Bah, the President of the non-governmental organization Actions Mines Guinee said: “They don't have a choice, primarily because Guinea's economy relies heavily on the extractive industry, which accounts for 32% of budget revenues.”
"According to the Extractive Industries Transparency Initiative (EITI) report, 78% of the country's export earnings and 18% of the gross domestic product (GDP) comes from the mining sector," Bah added.
Guinea ranks as the world's second-largest producer of bauxite, the ore used to make aluminium, while the nation is also home to the Simandou range, the largest untapped iron ore deposit in the world. The country also has gold and diamond reserves. However, the nation of 13 million people remains stands as one of the poorest in the world.
The coup leader said: “We took power by force in order to end poverty, endemic corruption, and economic mismanagement. The extractive industry has been especially prone to corruption scandals ever since Guinea gained independence from France in 1958.”
Abdoulaye Oumou Sow from the front for the defense of the Constitution FNDC said: “Before Guineans can reap the benefits of their own riches, the mining sector is in need of a clean-up.”
"All mining contracts signed by Mr Alpha Conde must be reviewed," Abdoulaye Oumou Sow added.
"We know that there has been much corruption. There has been a lot of mismanagement. There has been a lot of embezzlement that has been revealed by the press. We are waiting to see what the junta will do."
The think tank analyst, Melly is confident that a review of contracts dating back decades is bound to happen, but perhaps not as soon as many would like.
"It's probably going to be the job of the democratic government that eventually gets elected at the end of the transition," he said.
He further stated that even if the group did not aspire to abdicate power, as committed in the transition plan, the military unit would counter difficulties to as promised in the transition proposal, the military would find it difficult to withstand international pressure, particularly from the Economic Community of West African States, ECOWAS.
Paul Melly further stresses: “It's not just the West who will benefit from a democratic Guinea, the nation's main investors Russia and China will also be watching closely.”
"If it were just Western countries insisting that Guinea should return to some sort of electoral model, it would be easier for, shall we say, nationalist elements in Guinea, to say the soldiers are standing up for Guineans and defying the old colonial powers," Melly explained.
While Russia and China are traditionally less interested in democratic niceties, they will be careful not to alienate other West African countries, a region where both are seeking to expand their influence.
“Whether the mining sector rules will be changed enough to ensure that the population also benefits from Guinea's riches remains to be seen. Even with its vast mineral deposits, Guinea still needs to tread carefully”, Melly said.
source https://www.alcircle.com/news/guinea-mining-contracts-review-bound-to-happen-but-not-soon-chatham-house-70495
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