South Africa: Africa Business In Brief Issue: 57

Last Updated: 16 April 2014
Article by Edward Nathan Sonnenbergs

Most Read Contributor in South Africa, September 2018

Ghana

Ghanaian president's appeal for West African trade integration likely to be frustrated by protectionism and poor transport links

  • Ghanaian president John Mahama has said the 15 members of the Economic Community of West African States (ECOWAS) urgently need to lower tariffs, promote free movement of goods and services, and deepen integration in order to promote growth.
     
  • Mahama, who took over last month as ECOWAS chairman, said West African nations in particular have struggled with poor transport links and a dependence on commodity exports. He pinpointed wariness of greater competition as a primary reason for holding back liberalisation of trade policy. Many of the region's smaller nations fear being overrun by the economic might of Nigeria, Côte d'Ivoire or Ghana, and are too dependent on "the taxes they collect on goods and services", said the Ghanaian leader.
     
  • One of the few advances so far has been a limited agreement on external tariffs at a summit in Senegal in October 2013 under the ECOWAS Trade Liberalisation Scheme (ELTS). Mahama said his immediate goal as chairman is to ensure all countries allow duty-free goods under this programme to promote the region as a free trade area.
     
  • Significance
    ECOWAS has to concentrate just as much on lifting barriers to trade as on making regional trade flows meaningful enough to attract investment. Progress on trade liberalisation is certain to be piecemeal and hard-fought, given the high degree of regional governments' revenues on tariffs.
     
  • However, improvement of transport links, such as extension of the railway between Côte d'Ivoire and Burkina Faso, is a prerequisite for tangible progress in ECOWAS's efforts to boost regional trade. That railway is optimistically scheduled for completion in 2017, but many more such road and rail projects are needed to make ECOWAS a true regional market of 300 million people, which would then attract investment in manufacturing and agriculture. Without that, even the limited progress towards free movement of goods and services that ECOWAS will be able to achieve will have a negligible effect on West African trade.

Guinea

Technical committee's report on allegedly corrupt acquisition likely to accelerate Guinea's recovery of lucrative Simandou mining rights
  • A Guinean technical committee investigating the acquisition of two iron-ore mining concessions at Simandou issued a report on 9 April recommending that BSG Resources (BSGR) be stripped of rights it alleges were obtained by corrupt means.
     
  • The rights to the northern half of Simandou were stripped from Rio Tinto in 2008 shortly before the death of former president Lansana Conté and awarded to BSGR, which sold 51% of its stake to Vale – which has not been accused of any wrongdoing – in April 2010 for USD2.5 billion, after spending USD160 million on development work.
     
  • Much of the evidence in the committee report is based on an investigation by the FBI in the United States in April 2013 when former BSGR adviser Frederic Cilins was taped agreeing to pay Conté's fourth wife Mamadie Touré – who co-operated in the sting – to hand over or destroy documents sought by the FBI. BSGR maintains that Cilins stopped working for them in 2006 and he faces four years in prison after pleading guilty on 7 March to obstructing a criminal investigation. BSGR insisted it would prove the committee's allegations were false.
     
  • Significance
    The clear recommendation by the committee and detail contained within its report makes it highly likely the government led by President Alpha Condé will proceed with moves to regain control of the concession. Although this would give Guinea a basis for putting Simandou back out to tender, BSGR will continue to fight its case and said it will pursue international arbitration to halt the government's "illegal" move. That legal battle will necessarily be lengthy, so Guinea will need to find a buyer convinced that BSGR's claim will ultimately fail.

Guinea

Guinean iron ore mining faces significant disruption as firms lock down operations and pull out foreign staff
  • Foreign mining firms operating in Guinea have suspended work at their sites and ordered expatriate staff to leave the country as a major outbreak of the Ebola virus has spread to the capital, Conakry.
     
  • Cases of the viral haemorrhagic fever, which has a fatality rate of around 90%, have centred on the remote southeastern region of Nzérékoré, but it took around six weeks to identify the disease as Ebola. The death toll in Guinea stands at 84, but new infections have occurred in Conakry, home to two million people.
     
  • Mining companies have said they are much more concerned by those cases than what was occurring in the southeast. A number of major iron ore projects are located there, including the Simandou project, ownership of which is split between Rio Tinto and a Vale/BSG Resources joint venture, as well as Sable Mining's Mount Nimba operation. Firms said it is relatively easy to prevent people entering or leaving mines, but in Conakry local employees have been told to stay at home, and foreign staff sent on indefinite leave.
     
  • Significance
    The high mortality rate of Ebola virus has caused understandable panic amongst expatriate staff, particularly with infections emerging in Conakry. The swift geographical spread is also complicating authorities' efforts to control the epidemic, with cases also emerging in Sierra Leone and Liberia, close to Guinea's southeastern border. Those two countries are now likely to follow the example set by Senegal, which closed its border with Guinea on 31 March. This suggests severe and prolonged disruption to the Guinean economy because of transport difficulties and suspended production.
     
  • The biggest impact is likely to come in mining because of the key role of foreign workers, who will stay away until their safety can be assured. The production and export of bauxite, of which Guinea holds a quarter of global reserves, will be disrupted for months, while the long overdue development of rich iron ore deposits now faces a further long delay.

Mozambique

Attack on Mozambique's Sena railway unlikely to herald escalation of Renamo attacks on commercial or military assets
  • At around 2100 hours on the night of 1 April, unidentified armed men opened fire on two trains on the Sena railway line, near Semacueza, between Muanza and Dondo, Sofala province. Both trains were en route from Moatize to Beira; one train was operated by Brazilian mining company Vale, the other by Mozambican Railways (Caminhos de Ferro de Moçambique: CFM). Both drivers were injured by gunfire, but rails were not sabotaged and the trains did not stop.
     
  • Vice-Minister of Interior, José Mandra, accused opposition party Renamo of the attacks in a statement, and media also reported the incident as Renamo attack. However, Renamo denied responsibility for the attacks venturing that "counterintelligence forces" might have staged the attack to discredit Renamo.
     
  • Significance
    Renamo could have attacked the Sena line since stepping up its armed attacks on police and army units in April 2013. The attackers are likely to have been a group of armed bandits; if they were Renamo members they were most likely to be acting independently, reflecting a lack of communication between the party's political leadership negotiating in Maputo with the government and small bands of fighters in the bush, but we do not assess an escalation of attacks as likely.
     
  • Small armed groups active in Sofala province are unlikely to have the capacity to severely disrupt the rail line with improvised explosive devices or grenade attacks, and the deployment of further security forces to the area is likely to mitigate risks of further attacks.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions