Each security is equivalent to 100th of an ounce of gold and is backed by physical gold. The Nairobi all-share index hit a 47-month low March 8, driven down by bank stocks and a Safaricom selloff. Having local currency exposure to the spot price of gold is attractive to local pension funds and others restricted in overseas investment. “It makes sense to be adding complexity to the stock exchange… Barclays is ‘pushing at an open door by launching a gold-based ETF,” an investment advisor said. “There’s clearly demand for gold here because people see it as a store of value.”
Mining: Latest News
Kurt Davis Jr., 10:24 am AFKI Original
Mauritania requires no royalty payments, which is not the norm. This is a benefit for oil, gas and mining explorers anxious about paying royalties when commodity prices are unpredictable. Mauritania’s corporate income tax rate is relatively low at 25% — a plus in a region where the tax and fiscal systems can change any investor’s outlook on risk and reward. Large government irrigation projects have aided agricultural production in the desert. Israeli technology and cropping strategies have had some success in other parts of Africa. There is potential here, but it requires investment in technology — not always a priority in agriculture.
Dana Sanchez, 11:34 am
South Africa ranks fourth in world for titanium reserves. This should give the country a competitive edge in the 3D printing market for aerospace. It’s a market expected to be worth tens of billions of dollars as aerospace, auto and military industries seek cheaper way to make parts. Aircraft makers want to replace aluminum bodies with lighter materials such as titanium alloys. South Africa says its 3D printer is 10 times faster than any other laser melting machine available.The new manufacturing process could save millions of dollars on production and fuel costs.
Peter Pedroncelli, 7:40 am AFKI Original
The rich will pay more tax. That’s one of the most riveting things to come out of South African Finance Minister Pravin Gordhan’s 2017 budget speech. Income tax increases across the board did not materialise, but wealthy South Africans will be taxed at a higher bracket. Taxpayers earning more than $115,000 a year will pay a 45% tax rate. Around 100,000 taxpayers will be affected. Investors and global credit agencies were keen to hear Gordhan’s speech — his second one in his second stint as finance minister. Here is a closer look at 12 things you should know about the 2016 South African budget speech.
Dana Sanchez, 9:52 am
The surprisingly strong bull market in commodity prices in 2016 contributed to increased activity in mining and metals deals in Africa, says Quintin Hobbs, Africa mining and metals transactions leader at Ernst & Young. Organizations ran leaner and more efficient, with stronger balance sheets. The outlook improved so significantly through the course of 2016, that the predicted level of divestments and assets listed at rock-bottom prices at the beginning of 2016 just didn’t materialize, another expert said.
Dana Sanchez, 5:34 pm
With its island-building binge, Dubai is a big customer for African sand. So are Africa’s expanding concrete manufacturing giants. For the island project “The Palm Jumeirah,” Dubai used 200 million cubic meters of sand and stone. Some of the sand came from the sea off Dubai’s coast but a large amount came from African beaches. In Cape Verde, one in three people is unemployed. Sand mining is a fast way to earn money. The consequences of excessive sand mining are devastating. On beaches where tortoises once buried their eggs, there is now only dirt and stones.
Mongabay, 9:25 am
There’s a mistaken belief that Africa is a continent of empty, freely available land open for development. Companies investing in land in Africa feel they can cut a deal with the government, raze the land, and create vast plantations. “No land is unclaimed,” a stakeholder said. “Uprooting communities without their consent from their lands and traditional livelihoods creates conflicts and social unrest.” Most disputes involving private investments in Africa – 63 percent – relate to local people being displaced off their land. These disputes affect sugarcane and palm oil production, mining for gold, diamonds and coal, and green energy to harvest wind and solar power.
Dana Sanchez, 2:34 pm
Supporters of the conflict minerals rule say it successfully held manufacturers accountable for the minerals they source from DRC. Its suspension would “enrich abusive thugs” and could lead to the complete repeal of Dodd-Frank regulations, implemented after the 2007-2009 financial crisis to limit risky practices that caused the U.S. banking crisis. However a U.S.association of manufacturers estimates the law costs U.S. businesses $9-to-$16 billion. This led to the suspension plan by Trump, who campaigned on a pro-business platform.
Dana Sanchez, 4:43 pm
The worst is over and commodities prices are climbing, World Bank says. But not everyone is ready to call it a trend. Despite some improvement, gold and platinum remain flat. The bouyant, even euphoric mood at this year’s Mining Indaba contrasts with recent years — 2016 was gloomy. Towards the end of the year, commodity prices rebounded. Investors want a stable political environment, regulatory certainty and labor stability. “In 2017, we are looking at expansion, local and international. Mergers and acquisitions are also starting to take place. There is consolidation,” a stakeholder said.
Peter Pedroncelli, 2:15 am AFKI Original
The African continent is home to some of the fastest growing economies on the planet, with numerous nations on the continent among the top 10 best performing economies globally. The best performing economies in Africa have benefited from government policies and structural reforms, which have resulted in strong inclusive growth. According to the International Monetary Fund’s (IMF) World Economic Outlook for 2016, a long list of African economies were in line to achieve positive growth above 3% for the year 2016.
Staff, 2:46 pm
Exclusively a South African gold producer until September 2015, JSE-listed Sibanye Gold is set to become the world’s fourth-biggest platinum and third-largest palladium producer. Sibanye hopes to acquire Montana-based Stillwater Mining for $2.2 billion. If completed, the acquisition will further dilute Sibanye’s portfolio. Sibanye began its expansion in 2016 with the purchase of platinum mines in Southern Africa. The Stillwater deal is in a whole other league. It’s much more valuable and involves mines far from Sibanye’s home country.
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