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For the first time in the Malagasy mining sector, Madagascar representatives of major mining and craft operations, who regularly opposed each other, sat around the same table. The aim: to discuss the way out of the crisis caused by the coronavirus, but also to oppose the reform of the mining law, whose new taxation could plague the already gloomy sector.
as reported from Madagascar, Laure Verneau
Technical unemployment between 60% and 80% depending on companies, destruction of thousands of jobs caused by mining … coronavirus has not spared the Malagasy mining sector. Jean Luc Marquetoux, President of the Chamber of Mines, sounded the alarm: “The main mine in the country has been closed since March 2020. It is estimated that the pandemic’s impact on the mining sector amounts to a deficit of around 40 to 60 million dollars per month. “
Under the combined effect of exogenous factors such as declining international demand and the fall in metal prices, but also endogenous – containment measures – the expected revenues and contributions of the national mining sectors will be severely affected in 2020 but also for those who come.
Another concern: the reform of mining legislation, which entered into force in 2005 and aims to increase mining taxation, seems unwelcome to economic operators who are concerned about the deterioration of Madagascar’s competitiveness as a preferred destination for foreign direct investment. The initiative of the Minister of Mines and Strategic Resources in November 2019 resumed the process, interrupted at the height of the state of emergency and containment, a few weeks ago. Jean Luc Andrianjafy, Fédémine’s president, calls on the government for help: “We could not work in January-February: it is the rainy season. At the end of March the containment fell and it only lifts at the end of September and there we only have the months of October and November … December it will be [à nouveau] the rainy season. How do you expect us to still pay the full cost of mining administration? ”
According to official statistics, mines make up just under 5% of national GDP. In 2006, export revenues from mining products amounted to $ 40 million, mainly consisting of chromium, graphite, mica and precious and semi-precious stones. The mines account for 60% of Madagacar’s foreign exchange earnings and 30% of tax revenues.
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