Guinea, the world’s largest exporter of bauxite, approved changes to its mining code that will make it cheaper for foreign investors to obtain concessions and operate mines.
The new code lowers taxes on mining and industrial and commercial profit, Djiby Diaby, a spokesman of the National Transition Council, the equivalent of parliament, told lawmakers today in the capital, Conakry. The minimum investment a company must make to acquire a concession drops to $500 million from $1 billion under the previous code, he said.
Rio Tinto Group and Vale SA operate in the West African nation, which also has reserves of gold and iron ore. Guinea is recovering from a coup d’etat that severed ties with the World Bank and the International Monetary Fund until 2010 presidential elections.
In 2011, Guinea withdrew a mining law it had approved two months earlier because the level of taxes included in the code “became unbearable for mining projects given the global economic climate,” Diaby said.
The changes are to make Guinea “more attractive” to foreign investors, Mines Minister Mohamed Lamine Fofana told reporters.
The free 15-percent participation level for the government in bauxite ventures remains unchanged, as well as the 7.5-percent level for aluminum projects, Fofana said.