Rwanda Mining Conference (London, October 2019)
It is a real honour to be here today to give closing remarks at this important mining forum. We’ve heard what fantastic opportunities there are in Rwanda, from a wide range of partners keen to do business here and in the region. It is certainly an exciting time to be looking to invest in Rwanda.
In my role as the UK Prime Minister’s Trade Envoy to Rwanda and Uganda, I have the privilege of promoting trade and investment links between our great nations, and I am very pleased to be here with a delegation of UK businesses to showcase both the strength of UK expertise and Rwandan potential.
Rwanda, as we have heard, has significant resource wealth. With well managed investment, this can make a major contribution to local and regional economic development.
Currently over 90% of Rwanda’s mineral resources are under-explored. And many local companies use outdated technologies developed over 30 years ago. Therefore the opportunity for collaboration is massive.
And the United Kingdom is well placed to assist in this development.
Earlier this year I had the privilege to host a roundtable with the Honourable Francis Gatare in London. There we agreed to increase cooperation in order to help promote much stronger business-to-business links in mining with the aim of helping Rwanda to transform its mining sector into a world class industry in order to fuel economic growth.
The key to unlocking this potential is investment.
But there are challenges. Flux in commodity prices; economic headwinds in various major economies and the need to compete with other countries to attract foreign direct investment.
In light of these challenges, there are three key foundations that investors need. A stable and predictable investment climate; open and transparent governance; and access to reliable geo-data.
o Firstly, a stable and predictable investment climate. Companies need to know that their investments in a country and in specific projects are safe, easy to access, and with a clear taxation regime applied equitably.
o Secondly, open and transparent governance. The fact is that security of exploration and mining license tenure is vital to encourage long term investment. It is essential to have a well-managed and transparent register of license ownership and clear rules on retention.
o And thirdly – access to reliable geo-data. This too is essential to attracting investment. The association between geological knowledge and economic growth is widely accepted. Modern, high-quality, digitally available geo-data will have a significant – even dramatic – effect on improving returns on exploration investment. The Rwandan Government has already acknowledged this and is working with UK support to implement an online portal that makes geological data readily available to potential investors.
Looking to make progress on these three key foundations for investment, the UK Government has been active in supporting the Rwandan mining sector for several years. The UK Department for International Development (DFID) was the first development partner to fund an integrated mining support programme in Rwanda. This was in collaboration with and in direct response to the Government of Rwanda’s priorities to develop the mining sector as one of the key drivers of economic development of the country, and one of the key earners of valuable foreign exchange.
In partnership with the Rwanda Mining Board, the Sustainable Development of Mining in Rwanda (SDMR) programme was established with two pillars of intervention:
1) to support an ‘enabling’ environment that will increase private sector investment into mining in Rwanda; and
2) to test targeted interventions in artisanal and small-scale mining that would lead to a more professional, efficient and economically viable mining sector.
The SDMR programme has contributed to the improvement of the investment climate in Rwanda’s mining sector by developing a Geological Information and Mining Cadastre System (GIMCS – pronounced G-MIX) in response to the Rwanda Mining Board’s needs for an integrated system. This system makes it easy for investors to apply for mining licenses; view maps and reports on Rwanda’s geology and mineral resources; and access up to date exploration data.
This pioneering support from DFID has helped strengthen the enabling environment and lay strong foundations for greater investment. I am now very pleased that last month a second UK Government department – the Department for International Trade, or DIT – began operations here in Rwanda for the first time.
DIT’s role is to help promote British expertise, and support businesses to export and grow into global markets. DIT also help overseas companies locate and grow in the UK. In Rwanda and other African countries they support UK businesses to enter and expand across African markets to generate economic prosperity in the UK, while also supporting African growth and poverty reduction.
Given the UK’s extensive mining expertise this represents a huge opportunity for Rwanda’s nascent mining sector to benefit from such expertise and investment of UK exploration companies and junior miners. These UK firms can work in partnership with local companies to realize the full potential of their resources. With this much needed investment, Rwanda’s mining production can be more efficient, more productive and be potentially scaled up to be more appealing to larger investors.
UK exporters and mining companies are supported and underpinned by world-leading professional services firms. This legal, financial and technical support for miners, owners and investors is undoubtedly why four of the six largest mining companies in the world are headquartered in London. And indeed why London is the traditional home for the listing of mining companies.
In addition to expertise is the need for high quality capital equipment, which is essential for the development of Rwanda’s mining industry into a higher tech and more productive sector. The UK is a major centre for the manufacture of equipment such as the engines in generators and heavy machines and rock crushing and conveying equipment. We have an opportunity to support Rwanda’s vision of becoming a manufacturing hub for mining equipment in the region.
Mining is an energy intensive industry, 3% of the world’s energy is spent crushing rocks. The UK has considerable expertise in renewable energy technologies, so there is a further opportunity to partner with Rwanda in the effective utilisation of the wind and sun to implement solar power and wind turbine solutions.
Furthermore, the final UK export to drive investment in the mining sector is the extensive know-how to explore; evaluate; design; construct; and operate mines around the world.
Finally, I would like to mention that a UK-Africa Investment Summit will be held in January 2020 in London, bringing together businesses, governments and international institutions to showcase and promote the breadth and quality of investment opportunities across Africa.
While there won’t be a major focus on mining, the Summit will use the City of London’s position as a world-class financial centre to support African countries to access the critical investment needed to unlock their economic potential. With approximately £8 trillion in assets under management and a wealth of investment expertise, the City of London can be Africa’s gateway to global investment.
Looking further ahead to June 2020 and the Commonwealth Heads of Government Meeting, or CHOGM as it’s known, which will be held here in Kigali, I am filled with excitement for next steps in this journey. The UK, as Commonwealth chair in office, will hand over chairmanship to Rwanda to drive the Commonwealth agenda for two years. Trade is one of the five key themes identified by the Government of Rwanda for their CHOGM, and, much as I hope this conference has been, I see CHOGM 2020 as a further springboard to push for greater investment in Rwanda, greater investment in Africa and greater trade across Commonwealth and global markets.
I truly hope this conference has proved fruitful for all who attended, not least for the Rwandan mining sector which will continue to develop, grow and prosper through new investment.