This year, for the first time, the African Development Bank is one of the official sponsors of the Mining INDABA in Cape Town. The Bank's visibility at this conference is being showcased by its mining team at their own stand throughout the conference period from 07 to 10 February 2011. With more than 3000 delegates participating, the Mining INDABA is Africa's largest gathering of stakeholders in the mining industry, including governments, project sponsors and banks. We had a brief interview with.
Mouhamadou Niang, AfDB Manager for the division responsible for mining transactions, and he had this to say in response to our questions:
Mr. Niang, you have recently intensified the Bank's efforts in the mining sector. What exactly is your vision for the Bank's role in that sector?
Our vision in this sector is aligned with the Bank's broader vision of promoting private sector investment and enhancing private sector contribution to economic development in Africa. We aim to become the partner of choice for both private investors and governments in this sector by contributing substantially to the financing of projects, and also by ensuring that best practices in terms of Corporate Social Responsibility, revenue sharing arrangements by the governments and the people, and environmental and social management are strictly followed.
Why do you think that the Bank is well positioned to implement this vision?
Given its financial capacity, its knowledge of the continent, and its mandate, the Bank is well placed to play an honest broker's role between private investors and governments. In recent years, the Bank has invested over USD 500 million in the sector, either as a lender or an equity holder through investment funds. This has allowed us to influence positively project structure vis-a-vis environmental management and social effects, in close coordination with other departments in the Bank including EDRE (Economic Analysis), OSGE (Governance) and ONEC (Environment).
What are the Bank's instruments to improve development impact in the mining sector?
The Bank uses several complementary instruments to foster development impact of mining investments. Mining investments have a great potential for enhancing development, if structured properly. In order to ensure that this potential materializes, the Bank uses various instruments at every stage of the project processing. At project design stage, the Bank works closely with investors to assess the development effects of their investments, as they relate to government revenues, employment especially of women, etc; and where necessary, can propose amendments to mining concessions. In numerous instances, the Bank has also worked with sponsors to include an SME linkage program, where we promote local sourcing of supplies and link large mining companies with local SMEs. The development outcomes are closely monitored during operations, alongside financial aspects of the investment. Finally, the Bank uses the opportunity of these investments to work with both sponsors and governments to improve governance of mining revenues, through the EITI programme. In cases where it is needed, the Bank will facilitate access to legal assistance through the African Legal Support Facility.
What do you hope to achieve with your visible participation in the Mining INDABA?
Indaba Mining is the premier gathering of organizations involved in the mining sector. Every year more than 3,000 delegates from all spheres of the mining value chain participate, including investors, equipment suppliers, governments, banks, etc. Therefore it is a unique opportunity to keep abreast of new developments in the mining sector. It also provides an opportunity to meet with Bank partners including co-financiers, clients, government representatives, and discuss specific projects that are in our pipeline or are being considered. Already, we have scheduled a number of meetings with representatives from these organizations. Finally, as sponsors to the Ministerial Session, we hope to be able to focus discussions on the role multilaterals such as the Bank can play in promoting a balanced relationship between governments and investors. In this respect, we have invited the Chairman of the Mining Law Committee of the International Bar Association, Peter Loen, to make a presentation on the Model Mining Development Agreement (MMDA) during the session.
Contacts
Onike Nicol-Houra
