Mali, Africa’s second-largest gold producer, has suspended the issuance of new mining permits to foreign companies.
- Mali suspends issuance of new mining permits to foreign companies
- Decision follows a devastating mining accident that claimed over 40 lives
- Reforms in the mining sector aim to increase state benefits from gold production
According to the Mali’s Council of Ministers, the issuance of artisanal mining permits to foreigners has been banned pending investigations into the tragedy.
This decision follows a devastating mining accident last month that claimed the lives of over 40 people, prompting the government to re-evaluate its mining regulations and prioritize safety.
The council has also imposed punitive measures on officials found culpable for the disaster.
The Kayes region incident
Tragedy struck in Mali last month when an illegal gold mine collapsed, claiming the lives of at least 43 people, mostly women, near Kéniéba in the western Kayes region.
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The collapse occurred at an abandoned site previously operated by a Chinese company, highlighting the risks associated with artisanal mining in Mali
This devastating incident marked Mali’s second deadly mining accident in just three weeks, following a mining tunnel flood that killed at least 10 people in late January.
Mali’s government seized equipment used in small-scale mining and dismissed local authorities connected to the accidents, strengthening safety measures and preventing future tragedies.
Mali overhauls mining laws
In 2020, Mali’s military leaders seized power and pledged to reform the mining sector to increase state benefits from gold production.
An audit revealed widespread tax evasion by multinational corporations, which were using tax planning strategies to shift profits to low-tax locations.
In response, President Goïta announced revisions to the country’s mining code, resulting in the renegotiation of contracts and the freeing up of over $1 billion in revenue.
Mali is the second-largest gold producer in Africa, accounting for a significant portion of the country’s economy.
According to the World Gold Council, Ghana took the top spot, producing 135 tonnes of gold from 2010 to 2024, while Mali came in second.
Mali’s mining sector is dominated by foreign investors, including China, and features prominent international companies such as Barrick Gold, B2Gold Corp, Resolute Mining, and Hummingbird Resources Plc.
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However, the sector has faced challenges, including disputes with foreign firms and concerns over tax evasion.
The reforms are expected to generate an additional $950 million annually, equivalent to 20% of Mali’s national budget.
According to Economy Minister Alousseni Sanou, these new revenues have enabled the country to pay off part of its internal and external debt and purchase military equipment.
