Rwanda to set new target for mineral sector

Miners at work in Rwanda. The fall in global prices of tin, cobalt and wolfram has led to a major drop in the earnings of Rwanda’s miners. PHOTO | FILE 

By Ivan R. Mugisha

In Summary

• The government targeted to collect $400 million from mineral revenues by 2017, but this figure is certainly “close to impossible,” according to the State Minister for Mines, Evode Imena.
• President of the Rwanda Mining Association Jean Malik Kalima, argued that the sector’s revival will depend on massive investment on top of better prices for Rwanda’s principle mineral exports — tin, wolfram and coltan.
• Each of Rwanda’s principle minerals lost value on the international market with the value of tin depreciating by 23 per cent, coltan by 41 per cent and wolfram by 46 per cent.

A new realistic target for Rwandan mineral export revenues will be released after the sector spiralled downwards a third year in a row.

The government targeted to collect $400 million from mineral revenues by 2017, but this figure is certainly “close to impossible,” according to the State Minister for Mines, Evode Imena.

Statistics by the central bank show that half way through 2016, mineral revenues have dwindled to $40.7 million, representing a 36 per cent sharp decline in value.

Compared with the same period in 2013, mineral exports accounted for $93.5 million, falling to $64.2 million in the same period of 2014.

The revenues recorded for the first half this year is slightly above a quarter of what was collected in the calendar year of 2015, and only a tenth of what the government targets to collect in 2017.

“We are working with stakeholders such as the Ministry of Finance to come up with a realistic target for the next couple of years, as we work hard to ensure that the sector remains strong,” Mr Imena said.

“Prices for our minerals are slowly beginning to normalise, so we expect the sector to start performing strongly again. We are also strongly looking into value addition, especially for cassetirite, so that we can sell processed minerals that are not very susceptible to international prince fluctuations.”

President of the Rwanda Mining Association Jean Malik Kalima, argued that the sector’s revival will depend on massive investment on top of better prices for Rwanda’s principle mineral exports — tin, wolfram and coltan.

“I cannot say that the target can be achieved or not, but what am sure of is that if investment in the mining sector double, we shall get back to massive production and propel the value of exports,” he said.

Mr Kalima said although many artisanal miners had given up on the trade for agriculture and other small business ventures, they will soon begin to remobilise and work once the prices shoot up.

READ: Drop in mineral prices forces Rwandans into farming

“The mood in the mining fraternity has been low for the past couple of years, but we have to be ready to grasp the opportunity when conditions on the international market begin to become favourable,” he said.

He also criticised banks for denying mining companies loans, which he said is one of the main reasons why investments in the sector are still low.

Each of Rwanda’s principle minerals lost value on the international market with the value of tin depreciating by 23 per cent, coltan by 41 per cent and wolfram by 46 per cent.

Poor performance by the mining sector weighed down Rwanda’s industrial sector, which otherwise had performed well after strong performances by energy and manufacturing sectors, according to the central bank governor