Sierra Leone reviews mining licenses in industry-wide cleanup

Truck carrying iron ore from Marampa mine in Sierra Leone.

Sierra Leone is reviewing all mining licenses as part of a government clean-up of the industry.

The West African nation has already canceled or suspended permits for assets that were not operational, Minister of Trade and Industry Edward Hinga Sandy said in an interview in the commercial capital of Ivory Coast, Abidjan.

“It’s not about restricting the mining sector, but about transparency, best practice and good governance,” said Sandy. The review is necessary because the administration of former President Ernest Bai Koroma allowed mining permits to be resold to third parties, or “cowboys,” without intervening, he said.

The government of President Julius Maada Bio won elections last year after a tight race against the candidate of the party that was led by Koroma for almost a decade. Once one of the great hopes of West African mining, the diamond-rich nation was hit by the iron-ore price collapse and the biggest-ever outbreak of Ebola in 2014.

One of the companies impacted by the review, U.S.-based Gerald Group, last month suspended iron-ore shipments from its Marampa operation on the government’s request. It will be in the interests of both parties to resolve the matter as soon as possible, said Sandy, without elaborating further.

Gerald is cooperating with the mining ministry and is complying with its license, the company said last week.

The government is carrying out a geophysical mapping project to have a better understanding of the value of the country’s resources, said Sandy. The project is part of efforts to improve revenue from mining and will place the ministry “in a better position when negotiating contracts,” he said.

Plagued by chronic corruption, double-digit inflation and the legacy of a civil war, economic growth stalled at 3.7% last year and has persistently failed in recent years to match an expansion of as much as 21% prior to the outbreak of the Ebola epidemic. Growth may see an improvement to 5.1% this year, according to the International Monetary Fund.

(By Leanne de Bassompierre and Katarina Hoije)

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