Action Plan for the Implementation of the Africa Mining Vision

Transcription

1 Action Plan for the Implementation of the Africa Mining Vision Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development Annual General Meeting October, 2012 Palais des Nations, Geneva

2 Action Plan for the Implementation of the Africa Mining Vision Content: 1. Key Drivers for Action 2. Strategic Orientation of AU 3. Key Activities and Milestones 4. Results Areas 5. Way forward

3 Key Drivers for Action The high incidence of poverty and underdevelopment in Africa in-spite of its abundant endowment of mineral resources; The awareness of the significant contributions that the efficient management of mineral resources can make towards the achievement(mdgs) and meeting the challenges of poverty eradication and broad-based socioeconomic development in Africa; Minerals are finite resources, the exploitation of which cannot last forever and must be utilized for the benefit of present and future generations;

4 Key Drivers for Action Africa has a comparative advantage but most minerals exported as raw materials potential for resource based industrialization has always been high Eleven African countries are actually among the top ten global resource countries in at least one major mineral. Source: Deutsche Bank; US Geological Survey (USGS); World Nuclear Association, cited from McKinsey Global Institute Analysis (2010)

5 Key Drivers for Action Least value The value chain in Africa ends here, at best Developed countries complete the chain Most value Exploration Mining Mineral processing Smelting & refining Semi fabrication Final product manufacture 1. Inputs 2. Inputs 3. Inputs 4. Inputs 5. Inputs Consulting services (surveying, drilling, design, bulk earthworks) Specialized equipment Utilities and raw materials Finance Run-of-mine ore Consulting services Specialized equipment Raw material inputs water and power Labour Concentrate Consulting services Specialized equipment Raw material inputs water and power Labour Refined product Consulting services Specialized equipment Raw material inputs water and power Labour Semi-fabricated product Consulting services Specialized equipment Raw material inputs water and power Labour Output/Sellable Product Output/Sellable Product Output/Sellable Product Output/Sellable Product Output/Sellable Product Run-of-mine ore for sale to miners Concentrate for sale to traders Refined product for sale at metal exchanges Semi-fabricated product for sale to manufacturers Final manufactured product for use Source: Adapted from Lydall, 2010

6 Key Drivers for Action Metal Refined use (2007) Share of China (2000) Share of China % (2007) % Aluminium (kt) 12, Copper (kt) 4, Zinc (kt) 3, Lead (kt) 2, Nickel (kt) Tin (kt) Crude steel (Mt) Iron ore seaborne imports (Mt) Source: Ericsson (2009) citing Chinese statistics and metal forecasting, Macquarie Commodities Research, Macquarie Capital Securities (2008). The increasing competition and demand for Africa s mineral resources in the new geopolitical and economic era; Demand for mineral commodities has soared since about 2003 Gold Copper Iron ore Nickel Lead Zinc PGMs Other Source: Raw materials data (2010)

7 Key Drivers for Action Selected commodity prices High commodity prices and demand have led to a surge in investment in African mining - created strong geopolitical competition for its minerals Source: PWC review of global trend sin the mining industry (2011)

8 Key Drivers for Action Africa needs policy space, and pro-active development state to achieve fair and equitable fiscal and investment regimes to maximize the benefits derivable from mineral resources exploitation; Africa s mineral resources remain under-explored and under-exploited and that geosciences knowledge is at a relatively too low level to attract exploration and investment; To avoid the Dutch Disease in the management of Africa s mineral resources and to ensure that mineral resources become a blessing and not a curse for our countries and peoples;

9 Key Drivers for Action Mining has relatively better rents than other primary sectors. These rents can catalyze growth of the other less competitive sectors Africa significant resource endowment: A key comparative advantage to harness Top producer of many minerals, but most exported as raw materials: Potential for mineral beneficiation is great Need to have a African common voice on how to use mineral resources for growth and development

10 Strategic Orientation of AU The AMV seeks to create a Transparent, equitable and optimal exploitation of mineral resources to underpin broad-based sustainable growth and socio-economic development It essentially seeks to use Africa's mineral resources sector as a tool for social and economic transformation

11 Strategic Orientation of AU AU Member States to work together to ensure that international agreements that they enter into enhance rather than undermine Africa s policy space for integrating mineral resources development into their economies ; Improve local beneficiation and value addition of Africa s mineral resources and the enhancement of its industrial base through mineral sector upstream, downstream and side stream linkages; Harness the potentials of Public Private Partnerships (PPPs) in the development and management of mineral resources;

12 Strategic Orientation of AU Improve mineral resource policies, legal, regulatory and administrative frameworks and enhance the capacity for auditing, monitoring, regulating and improving mineral resource exploitation regimes; Improvement in the governance of mineral resources is critical to maximizing sustainable investment and development outcomes in the mineral sector; African Peer Review Mechanism (APRM) Secretariat to include in the forthcoming country reviews a chapter on natural resources governance; Support the establishment of national oversight bodies and independent committees to monitor mining projects;

13 Strategic Orientation of AU Member States of the African Union to mainstream governance best practices such as the Extractive Industry Transparency Initiative (EITI) into their respective policies, laws, regulations, codes and standards; and expand the initiative to address upstream and downstream issues such as licensing, procurement, ownership, and sustainable development and call for its urgent operationalization; The mining companies operating in Africa to adopt a more holistic corporate social responsibility approach that pays as much attention to the environmental and materials stewardship, human rights, gender dimensions, social and economic choice, cultural heritage and empowerment of local communities. Building of physical and resource knowledge infrastructure and strengthening of the institutional, human, and technical capacities needed to develop the continent s mineral resources potentials;

14 Strategic Orientation of AU Accelerate intra-regional harmonization of laws, regulations and fiscal regimes to create intra-regional synergies and promote intra-regional mobility of goods, services and capital for the development of the mineral sector; AU Commission, in collaboration with the UNECA, AfDB and other relevant partners, to assist AU Member States in their auditing, review and renegotiation of existing mining agreements; Establishment of a network of key development corridors across Africa to realize the continent s resources and their associated potentials;

15 Key Activities and Milestones AMV Developed the AMV Ministers requested for AP for implementation Developed Assembly Decision for AMV AP AA - D AA - D Developed an Action Plan Ministers approved Action Plan Developed Assembly Decision for AP for AMV Ministers Adopted the Addis Ababa Declaration Calls on AUC on collaboration with partners to assist MS in the implementation of AP for AMV Ministers endorsed establishment of AMDC to accelerate the implementation of the Action Plan for AMV Welcomed support from development partners

16 Key Activities and Milestones Decision on the Report of the Second Ordinary Session of AU Conference of Ministers Responsible of Mineral Resources, December Doc: EX.CL/749(XXI ) has been endorsed by the summit in July2012. The Action Plan for the AMV and the establishment of the AMDC are hence now formal AU decisions supported by the Heads of State and Government A draft Business Plan, based on the Action Plan, has been compiled to serve as a project document for establishing the AMDC Conversation has been maintained with development partners for establishment and funding the AMDC

17 Results Areas Seven Results Areas have been derived from the Action Plan for the short term action ( 5 Years ) for AMDC Policy and licensing. Geological and mining information systems. Governance and participation. Artisanal and small-scale mining. Linkages, investment and diversification. Human capital and institutional capacities. Communication and advocacy.

18 Results Areas Goal: To create a sustainable and well-governed mining sector that effectively garners and deploys resource rents and contributes to broad-based growth and development. Policy and Licensing Create AMV compliant policies Optimize tax regimes Improve management of mineral revenue

19 Results Areas Goal: To improve geological and geospatial information and its use in mining and broad development processes in Africa. Geology and mineral information systems Improve exploration rates Upgrade mineral inventories Improve institutional capacities

20 Results Areas Goal: To create a sustainable and well-governed mining sector that is environmentally and socially responsible, and appreciated by all stakeholders including surrounding communities. Governance and participation Strengthen transparency Improve public participation Strengthen environmental & social management programmes Build capacities

21 Results Areas Goal: To create a mining sector that harnesses the potential of artisanal and small-scale mining to advance integrated and sustainable rural socio-economic development. Artisanal and small scale mining Improve ASM policies Promote a viable ASM Upgrade skills and technologies.

22 Results Areas Goal:To create an investment-friendly mining sector that is a key component of a diversified, vibrant and globally-competitive industrial African economy. Linkages, investment & diversification Improve R & D Enhance mineral value added Promote private sector investment Explore SD corridors

23 Results Areas Goal: To create a mining sector that is knowledge-driven and is the engine of an internationally competitive African industrial economy. Capacity Building Build human & institutional capacities Build stakeholder capacities Diversify E & T funding

24 Results Areas Goal:To improve social and economic development options through a free flow of information among all stakeholders around the AMV, AMDC and mineral-based transformation. Communications and advocacy Communicate activities Create awareness Entrench ownership

25 Way forward As decided by the June AU Summit, AUC to take lead in the preparation of concrete Business Plan for the establishment of AMDC in collaboration with UNECA, AfDB, RECs and other stakeholders Publicize and popularize the Action Plan for AMV and engage with stakeholders and build coalitions for implementation at national, regional, and continental levels Member states to internalize the Action Plan for AMV in their national development strategies

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