Post #206

💡Resource Nationalism Index [ GUINEA ] With the start of the Simandou iron mega-complex, Guinea is going to transcend its usual span of bauxite and gold exports. However, any diversification also means a new challenge and an endurance test for Guinea's resource policies. Is the country prepared enough to embrace its strengthened clout in iron production? Let's figure out in our "Resource Nationalism Index" series. The policies of Guinea in relation to its natural wealth are: 🔸"Process It First" – 6/10 – Export of unprocessed ore is not formally banned, but Guinea's Mining Code requires companies to develop processing capacity for the minerals they extract. All bauxite producers must begin building alumina refineries in Guinea no later than 2027. 🔸 "Share With the State” – 0/10 – The state does not take a physical share of production + there are no mandatory domestic supply quotas 🔸 “We’re in Too!” – 7/10 – The state has the right to get 15% free-carried interest + an option to purchase up to an additional 20%, bringing potential total state ownership up to 35% - without any additional share reserved for local investors. 🔸 “The Money's Yours, the People Are Ours" – 6/10 – in each company the Deputy General Manager must be Guinean, and within 5 years from the start of operations the General Manager must also be Guinean. As of subsidiaries, at least 30% of all goods and services must be procured from Guinean companies. 🔸“Just Pay Up" – 3/10 – Royalty on gold - 5% of production value, while royalty on bauxite is extremely low - around 0.075%. 🔸"You Come – You Build" – 7/10 – Annual contributions are based on turnover: 0.5% for bauxite and iron ore, 1% for gold and other minerals. 🔸“We’ll Do It Ourselves” – 6/10 – The government engages in investments via state-run SOGUIPAMI company, while maintaining some tax breaks and incentives to encourage local processing. 🔸“Come Here, You Bast*rd!” – 5/10 – In 2016 artisanal gold output has been estimated at around $300 million, while artisanal diamond mining (“diamond triangle” - Kerouané, Kérouané, Beyla, Macenta) largely operates outside formal licensing. Between extreme resource nationalism and wild capitalism, Guinea prefers to choose neither - remaining in the middle on the most parameters. The only aspect that negatively diverges from this tendency is the lack of requirements to transfer a fair part of production to the state or put it in the local market. #ResourceNationalism Devils Below