Despite the current
slump in commodity
prices the extractive
industry in Africa
remains a
catalyst for
long-term
growth,
according to
Rio Tinto’s
diamonds and
minerals chief
executive, Alan
Davies.
“Partnerships,
however, are
key to mining
success in
Africa,” he said.
He warned that in the current
tough economic times it was
important for companies to
collaborate rather than retreat
to their own corners.
“The economic volatility has
been challenging for everyone
and achieving strong growth is
not easy. We have to recognise
that prices are at decade lows
and investment in mining
projects is just as low. Everyone
is more risk averse,” he said.
“I am however
constantly
reminded of the
resilience and
dynamism of
the continent.”
He said
collaboration
between
government
and the
private sector
was just as
important in an
industry where
productivity was ultimately the
determining factor of success.
“As operators we need to
innovate more. We need to
look at how we operate while
governments need to look at
how they govern and create
environments where there is
investment certainty. Africa
also requires infrastructure.”
With every tradable
commodity having declined
in the past twelve months –
and the World Bank recently
revising 37 out of 46 commodity
prices downwards again – there
has been less revenue all round
for the private and public sector
alike.
“We are all confronting the
same challenges together – and
in the short term it will be very
difficult,” said Davies. “Our
shared objective however is the
same – to achieve sustainable
broad-based growth for the
continent. Partnerships between
the government and private
sector are the only way to
achieve common objectives in
the future.”
He said with a collaborative
approach there was no doubt
that Africa’s extractive industry
still had much to offer the
continent and would lead to
long-term economic growth.
“China may not be seeing
the double digit growth of a
few years back but it is still
growing in absolute terms. The
long-term demand for African
minerals will continue and all
the signs are pointing in the
right direction.”
INSERT & CAPTION
The long-term demand
for African minerals will
continue and all the signs
are pointing in the right
direction.
– Alan Davies
