From News Time Africa
The frontier markets of Western Africa have the most promise for uncorrelated long-term potential of all sub-Saharan Africa. Having covered the larger countries of this region — Nigeria and Ghana — I want to now take a deeper dive into those countries less familiar to many investors, Sierra Leone and The Ivory Coast (Côte d’Ivoire).
As hard as it may be to imagine, I believe these countries, collectively and individually, will overtake South Africa in the next five to 10 years in terms of growth.
Sierra Leone, a country of six million, experienced GDP growth of roughly 15 percent in 2012 and again in 2013. Like many African countries, this growth was driven by the mining sector. Iron-ore production contributed to the country’s GDP growth from 6 percent in 2011 to current levels, which are expected to continue as iron-ore projects become fully operational.
African Minerals AMLZF +2.09 percent owns 80 percent of the Tonkolili project, having sold 16.5 percent share of it to China’s Tianjin Minerals and Equipment Group (private). Previously, AMI received a large investment from China’s Shandong Iron & Steel Group . With these investments, the company will expand Tonkolili from 20 million metric tons per year to 35 million of open-pit production. For comparison, the Carajas Mine in Brazil, the world’s largest iron-ore mine, produces over 300 million metric tons of ore.
China is a huge investor in Sierra Leone. According to the country’s Ministry of Mines and Mineral Resources, China’s Kingho Energy Group Co., Ltd (private) will spend more than $6 billion in the development of mineral resources there. These projects include the construction of a railway and a deep-water port.
China isn’t the only investor in Sierra Leone. London Mining UK:LOND -3.52 percent owns 100 percent of Sierra Leone’s Marampa mine, a working iron-ore facility (mine, power plant and processing plant) with an estimated 40-year lifespan, according to the company. Currently it is producing 5.4 million metric tons per year.
Written by Peter Kohli/Read more at News Time Africa