Angola is on a drive to diversify its mining base away from a primary reliance on diamonds and oil, the country’s secretary of geology, mines and industry Mankenda Ambroise has said.
He told a mining conference, which was recently held in Cape Town that Angola was one of the major producers of iron ore, gold, copper, phosphates, bauxite, and uranium prior to its independence in 1975.
However, the Independence Day also marked the beginning of a civil war that saw the People's Movement for the Liberation of Angola (MPLA) and a rival rebel group, the National Union for the Total Independence of Angola (Unita), engaged in a bloody 27-year conflict for control of the country.
Ambroise, said although the civil war ended in 2002, it left a great deal of damage on the country’s mining operations.
He said Angola, which was the second largest petroleum producer in Sub-Saharan Africa after Nigeria and the world’s fourth biggest diamond producer, was yet to realise the full potential of its minerals.
“With the country yet to be surveyed, current mining operations represent a fraction of Angola’s potential,” Ambroise said.
“That’s why (the country) is pressing ahead with moves to diversify its mining base away from a primary reliance on oil and diamonds.”
The global economic downturn that wreaked havoc on the diamond industry towards the end of 2008 and the better part of 2009 might have taught Angola a lesson on not to heavily rely on diamond and oil revenues to drive the country’s economic development.
Angola’s high growth rate of 13.2 percent in 2008 was driven by the oil sector, which enjoyed high international prices at the time.
However, this was not the case in 2009, when the global economic crisis pushed oil prices downwards, while OPEC member countries were also forced to cut production levels.
The price of a barrel of oil fell from a peak of almost $150 in 2008 to below $40 in early January 2009 as demand for oil fell sharply in line with the global economic downturn.
On diamonds, Angola was forced to revise its production output of 10-million carats in 2008 to 8.67 million carats, which was realised that year from 2007’s 9.7 million.
Global diamond prices also tumbled 8.5 percent in 2008.
Ambroise said Angola’s diamond industry had to be content with the difficult operating environment, adding that although the worst time of the global economic downturn was over, there was need to tap into other minerals, while expanding the diamond deposits as they also remained largely unexploited.
Ambroise said companies that wished to do business and invest in the diamond industry in Angola should do so in partnership with Endiama.
The partnership, he said, was negotiable and limited in the case of kimberlite.
He said all minerals belonged to the state, and the ministry of geology and mines managed mineral exploration and development activities through the granting of relevant prospecting licenses and mining title.
He said mining concessions were awarded on the basis of ‘first come, first served, provided that applicants had the required financial and technical expertise to carry out the mining and mineral development works.
“There is no need to jump the queue,” he said.
He said the Angolan government was deeply committed to creating an enabling environment for investors to invest in diversified mineral development with the vision of making the country’s mining industry a destination of choice for doing business in Africa.
Meanwhile, Ambroise said Angola was still aware of the illicit diamond problems that had a potential to affect the country and regional economies.
“In this regard, as one of the key and active players in the Kimberley Process, Angola continues to implement measures in order to prevent the problem of conflict diamonds,” he said.
Ambroise said one of the measures taken to prevent and combat illicit diamond trading was the sales and export of the Angolan rough diamonds through the government’s diamond-trading company, SODIAM.
Looking at the presentation made by Ambroise, on the need to diversify Angola’s mineral base, one can be tempted to conclude that the country was still a long way from shifting its reliance on diamonds and oil.
His paper dwelled much on diamonds than other commodities he sought to encourage prospective miners to invest in.
For now, Angola’s key to economic development, largely remained on diamonds and oil.
Mathew Nyaungwa, Rough&Polished, from Namibia
