MOZAMBIQUE’S new requirement for the state to hold a 15% free-carry stake in all mining ventures risks deterring foreign investment, said Reuters citing the Southern African country’s Chamber of Mines.
Speaking at a mining conference in Victoria Falls, Zimbabwe, chamber vice-president Geert Kolk said the mandatory shareholding, introduced through an amendment to the country’s mining law, would not make Mozambique a more attractive destination for foreign capital.
The amended law also prohibits exports of unprocessed or semi-processed minerals without ministerial approval linked to local processing commitments. Kolk said the chamber supported greater in-country value addition, describing it as a legitimate regional trend, but stressed that governments needed to provide reliable water, electricity and logistics to make local processing viable.
“We will have, unfortunately in our opinion as the Chamber of Mines, a minimum of 15% free carry stake of the state in mining companies, which we fear will not make Mozambique any more attractive as an investment destination for foreign capital,” he said.
Mozambique says the changes were introduced to strengthen management of strategic resources in the national interest.
The country is among the world’s leading graphite producers and hosts significant mineral assets including Syrah Resources’ Balama graphite mine, the Montepuez ruby mine owned by Gemfields, and substantial coal deposits previously held by Rio Tinto and Brazil’s Vale.
