Interview: Régis Immongault
What strategies should be pursued to increase the attractiveness of the mining sector?
REGIS IMMONGAULT: Gabon has remarkable mining potential and is committed to international standards. Even with our vast resources of manganese, iron, gold and tantalum, only three companies are exploiting them. This figure is insufficient for a country that aims to become a major mining producer and use the sector to foster industrialisation. However, the contribution to GDP is expected to rise from 8% currently to between 20% and 25% by 2020. A national strategy has been drafted and we have the resources, work and immigration standards, and labour force to create a safe environment for investors to meet financing.
In relation to exploration, we should stress the importance of fiscal competitiveness and administrative procedures. While it is the private sector that carries out the exploration, it is crucial for the state to know what its territory contains, thus new measures to encourage best practice are being launched.
Although expertise and human capital may be insufficient, and training more expensive than in other countries, Gabon has already created measures to resolve these issues. At the same time, we compensate for our skills gap with low energy costs, a credible banking system and political stability. Those who invest in Gabon want to have the appropriate guarantees and we have the conditions to provide them. Additionally, it is also important to stress transparency.
In what way can overcoming infrastructure challenges help support the sector’s development?
IMMONGAULT: We can only achieve a successful mining sector if we build suitable infrastructure. This reality remains a key obstacle. To address this challenge the government has drafted a master plan according to progress with economic development. The master plan has been aligned with the needs of road and rail infrastructure, energy resources and industrial projects. The challenge arises when seeking funds to finance such costly operations. As we do not want the state to take on all of the costs we have included a certain number of public-private partnerships (within the framework of this master plan). In this regard, I should mention the case of Bélinga, whereby such a partnership has helped raise sufficient funds to create the necessary port and train infrastructure to be able to exploit the area’s abundant iron resources.
What are the main provisions of the mining code?
IMMONGAULT: The new mining code will emphasise the sector’s attractiveness and the social responsibilities and environmental factors that relate to this. To encourage this transformation we have created a legal framework that will have a direct impact on fiscal incentives, ease of bidding, securing foreign direct investment for long-term projects, transparency and Customs procedures. It is a consensus between the state and mining operators. The initiative will enable best practices for exploring and exploiting minerals in a locally integrated way, particularly by sub-contracting small and medium-sized enterprises. In relation to royalties, they are generally not very high; this is only the case when referring to precious raw materials such as diamonds.
How can the forestry segment be developed?
IMMONGAULT: We have designed an industrialisation strategy included in the Emerging Gabon national development plan. Among the priorities, we will launch a set of inclusive measures in the mining and forestry industry, where we have a wide competitive advantage. We are currently working on the first stage, which is to ban the export of raw wood to encourage its transformation in Gabon, and thus benefit the local economy. After the transformation process, the raw wood is expected to multiply its value by seven, and in four or five years we expect to start taxing the first batch of transformed wood. To achieve this goal, we are already collaborating with wood artisans to provide training and financing. It is vital for us to improve the rate of return.
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