After a day of violent protests, the military seized power and effectively dissolved the country’s parliament.
This is a surprise, coming out of one of the more stable countries in West Africa and one that has avoided brutal decade-long civil wars like the ones seen in neighboring Sierra Leone and Liberia.
Protests erupted after long-time President Blaise Compaore proposed they have a national assembly to vote on whether to allow him to run for a fifth 5-year presidential term. Protestors stormed the parliament building and set fire to the main chamber in disapproval, and the vote never took place.
On Thursday evening, only a few hours after the President declared a state-of-emergency and called for an end to the protests, the Burkina Faso military staged an apparent coup d’état and announced the dissolution of the government.
In a press conference, General Honoré Traoré, said that a “transitional body” would be set up in the interim before a return to the constitutional order within a year.
Since then, the President has declared he will maintain power over the next year in transition. However, the opposition and protesters want him gone now.
Beyond the obvious and immediate troubles this causes for the region, a large component of their economic future, mining, is under threat as well.
A whole slew of companies came out with news releases throughout the day today which said something along the lines of:
“Company X has provided the following update regarding the civil unrest in Burkina Faso. The company’s operations at the X project, located approximately X kilometres from the capital of Ouagadougou, are uninterrupted, on-site work continues, and all of its employees are accounted for and safe. Company X will provide further updates as events warrant.”
Although these releases are probably true, the reality is that this apparent coup d’état is so new that no one in the region knows what effect (lasting or not) it will have on the mining sector.
With investors already running for the exits and no risk appetite to be found anywhere, this could cause even further price declines for companies with exposure to the country.
There are a number of public mining companies with significant exposure (>33% of assets) to Burkina Faso, including many single asset developers. These include:
Others with more diversified portfolios but that still have exposure to Burkina Faso include:
Burkina remains a critical ally for the US and France in the region and the country has been proactive in the fight against Muslim extremists within its borders. France was set to send in more troops to assist in the coalition against extremists in the area.
The country has been a relatively stable part of West Africa and we hope peace is restored soon so that average Burkinian’s can return to their daily lives.
Here’s video courtesy of BBC News of what occurred today: