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(Ecofin Agency) – Last year, after an audit of its mining sector, Mali decided to suspend the issuance of new mining permits. A new mining code was subsequently adopted to boost and even double the sector’s contribution to GDP.
Mali’s National Transitional Council, which currently serves as the country’s legislative body, passed a new mining code on Tuesday, August 8. Adopted unanimously by the plenary session, the new law will generate additional annual revenues of at least 500 billion CFA francs ($803 million), reports the state-owned broadcaster, ORTM.
The new code increases the mandatory state interest in mining projects from 20% (in the 2019 code) to 30%. The government’s free participation is maintained at 10% with the executive allowed to acquire an additional 20% interest within two years of the mines entering commercial production.
In addition, local private players will be able to acquire a 5% interest in the mines, giving Mali a total stake of 35%. In a mining sector essentially dominated by foreign mining companies (notably Canadian, British, and Australian), these new provisions are expected to raise the sectoral contribution to GDP to 20%, from 9% currently.
The new provisions could pave the way for the resumption of the issuance of new mining titles. After an audit revealed that Mali was not receiving a fair share of the profits generated by its mining sector, Bamako suspended the issuing of mining permits in December 2022.
A second law on local content in the mining sector was also passed by Parliament. It is particularly aimed at getting more nationals into management positions and promoting technology and skills transfers in the mining sector.
Gold is the main product mined in Mali. In 2022, public revenues generated by the yellow metal reached a record 763.7 billion CFA francs ($1.3 billion), up 35% year-on-year.
Emiliano Tossou
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