Mali wins $160m in gold mining dispute
Resolute Mining has agreed to pay a $160 million settlement to the Malian government, addressing outstanding claims related to tax, customs levies, and offshore account management. The agreement follows the detention of the company’s CEO, Terence Holohan, and two other British employees in Bamako during a negotiation with the government.
Mali recently revised its mining laws to increase government stakes in mining projects and boost revenue from international companies. The government can now mandate up to a 30% ownership stake in mining ventures and require companies to sell an additional 5% to local investors. The government’s assertive stance is partly driven by financial pressures, including funding operations involving Russian mercenaries like the Wagner Group and compensating for reduced Western aid.
Mali’s ongoing security challenges, including jihadist insurgencies, have exacerbated fiscal strain. Analysts warn that retroactive application of the new laws and incidents like the detentions risk deterring future investment in Mali’s mining sector.
Resource nationalism
Similar disputes have emerged with other companies, such as Barrick Gold, indicating a pattern of escalating tensions between Mali and international miners. The company operates the Syama goldmine in Mali, where it holds an 80% stake, and another mine in Senegal. The substantial settlement and associated reputational risks may prompt reconsideration of its operations in the region.
Broader implications include; investor confidence where the treatment of mining companies and the unpredictability of regulatory enforcement may lead to a reassessment of risk among global investors in Mali and similar jurisdictions.
Mali’s moves are part of a broader trend of resource nationalism across Africa, where governments seek greater control over and benefits from natural resource extraction. The government’s alignment with Russian interests, including the Wagner Group, reflects shifting alliances and increased leverage over international stakeholders.
