Insight on Africa

2012 Nov 09

As the global economy continues to struggle, Asia is not the only region worthy of a gold star for growth. Africa has also been surging ahead at an impressive rate. M&C talks to the region’s mining specialist Andy Ndulubila to get the inside story.

Q: Africa has been showing positive growth at a time when other parts of the world are struggling. What?s the secret? 

A: There are several factors involved. Firstly, the financial crisis did not affect Africa in the same way as other parts of the world. African countries did not have such massive debts to deal with. Secondly, the world demand for commodities was strong, metal prices were up and this region had plenty of mineral resources to offer. This combination, coupled with a young and enthusiastic population inevitably led to rapid growth right across the region.


Q: Africa is now described as one of the world?s fastest growing economies. How fast is it growing?

A: In the past ten years, growth in Africa has surpassed that of East Asia. Data suggests that parts of the continent are now experiencing fast growth comparable to or greater than that of the Asian Tiger or Latin Puma markets, giving Africa the nickname of the Lion Markets. The fastest growing nations experienced growth significantly above the global average rates and many international agencies are increasingly investing in emerging African economies where the rate of return is currently the highest in the developed world. Growth was 3.4% in 2011, down from 5.0% in 2010. But with the recovery of the North African economies and sustained improvement in other regions, growth across the continent is expected to accelerate to 4.5% in 2012 and 4.8% in 2013.


Q: Which countries are growing
the fastest?  

A:All countries that have major mineral resources ? Mauritania, Angola, Mozambique, Burkina Faso, Ethiopia, to mention just a few. They are all working hard to meet the demand. Exploration projects have increased and we expect these to result in several new mining operations. And thanks to increased technological and application knowhow, which enables us to provide value added solutions, many workings that were regarded as marginal can now become profitable ventures. At the same time, existing mining operations are  scaling up and both production and productivity are being increased. So the mining industry is clearly the driving force for growth.


Q: What are the biggest challenges facing the mining industry in Africa today?

A: We see three main challenges; retaining skilled personnel, safety and choice of equipment. The skilled operators in underground mines are often attracted by other mines around the world and this leaves a constant void. Everyone is aware of this so training is a top priority. One of the ways that this is being tackled is to focus on the family. If several people from the same family are recruited to the industry it is often easier to retain them. Safety is also a big concern and this is emphasized in most companies which is why there is a constant need for the correct application and optimization of equipment.


Q: What is Atlas Copco doing to support these companies?

A: We stress the importance of training and safety in relation to all our products in every country of the region. Some companies now use our training simulators and this will increase. Simulators speed up the training of new operators and allow them to make errors without injurying themselves or anyone else before they are permitted to take control of a real machine. We are also very focused on helping customers to achieve long term sustainability by providing cutt-ing edge solutions and efficiency through optimization.


Q: Which products do you think will make the most significant contribution?

A: If they are used optimally, all Atlas Copco mining equipment will make a big contribution. But the strongest contributors will be those units which offer a combination of good ergonomics and control systems, are easy to use, accurate and safe and give high performance. These capabilities will increase productivity resulting in a lower cost per tonne.


Q: How important is customer financing?

A: It?s a key element of our service and in recent years more and more companies have been taking advantage of it. If a mine or mining contractor finds it difficult to raise funds for an equipment purchase, for example, or if local terms are too demanding, we can usually offer a solution with Atlas Copco Finance. As a leading supplier with a long history in Africa, we know the mining business well and the challenges that the mines face. And we look at the whole operation with a view to establishing a long-term relationship. Today we are assisting a long list of companies including AAC, Reliant Drilling, Rig Resources, Blue Rock, Drill Africa, and others. And this involves exploration and mine development as well as production equipment. We recently assisted mines in Sierra Leone and Ghana to secure the financing they need for mine development.


Q: What?s your personal aim?

A: My mission is to help our customers to achieve and exceed their targets, to secure their sustainability and ensure that the industry regards Atlas Copco as the first choice solution provider.

Africa?s riches in the ground 

Africa?s 30 million km2 of land contains more than 60 different metal and mineral products and around 30 percent of the world?s mineral reserves including 40% of the  gold and 60% of the cobalt.

Gold is the predominant mineral and major deposits of gold, copper, diamonds and other minerals are mostly found in the copper belt of southern Africa.

Mining is therefore the largest sector involving some 665 mining companies. The industry is dominated by South Africa, Ghana, Zimbabwe, Tanzania, Zambia and Congo.

According to some reports, the region is said to contain six of the world?s ten fastest growing economies.

Epiroc operated under the trademark “Atlas Copco” prior to January 1, 2018.