Anglo upbeat on Africa

Brendan Ryan | Tue, 02 Feb 2010 10:19

[miningmx.com] -- THE next decade could be shaping up to be the very best for Africa in terms of economic development according to Anglo American CEO Cynthia Carroll.

Addressing the Mining Indaba Conference being held in Cape Town on Tuesday, Carroll pointed out that overall growth in gross domestic product (GDP) in Africa had remained positive in 2009 and was likely to rise by more than 4% this year.

Her comments echoed those made in a previous presentation by Thomas Barnett, MD of Enterra Solutions, who spoke on Africa’s “long future” in the global economy.

Barnett highlighted the rising interest of the United States in Africa as well as the growing presence of China looking to secure sources of supply of key commodities.

Barnett quipped that, “my advice to African governments is to keep freaking those guys (the United States) out while charging these guys (China) as much as possible.”

Carroll told the conference that there was “a lot to be optimistic about” in terms of the current overall economic outlook although there were concerns over the sustainability of the general economic recovery as well as transport and energy challenges in Africa in particular.

She commented, “there is growing consensus that a global economic recovery is underway although questions remain over its sustainability, particularly in the advanced economies.

“I have just come from Davos where it became clear that, to some extent, we are now operating in a world moving at two speeds.

“The advanced economies are growing at a slow speed while the major emerging economies are growing more robustly.

“Over the next year the advanced economies will have to wrestle with high unemployment rates while the emerging economies will have to deal with rising inflation.

“I think we should take comfort from the fundamentals supporting countries like China, India and Brazil. Chinese growth will continue to support demand for metals while the growth of the Indian economy may be the most important aspect of the next decade.”

Carroll highlighted the availability of sufficient energy and water as two of the key challenges facing groups such as Anglo American in the future. She commented, “Estimates are world primary energy demand will increase by 50% over the next 25 years. Reliable and secure energy supplies will be vital for long-term investment decisions. “In South Africa how we tackle the energy situation will be crucial. None of us are in a position to sustain large increases in the price of energy year after year. “All the parties involved - Eskom, government, corporations and non-governmental organisations – must act in concert to get cost-effective solutions.”