African year that was all about Ebola

FOR Australian operators in Africa, 2014 will probably be best remembered for the renewed outbreaks of Ebola in west Africa which somewhat unfairly had the investment community shying away from the entire continent, writes African Angle columnist Barry Avery.
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South African President Jacob Zuma

Barry Avery

Without diminishing the concern the world should have over the latest outbreak, it must be remembered that this is not the first time Ebola has threatened African countries – nor is it likely to be the last. And in terms of annual continental body count, there are far worse afflictions that African countries endure. Far worse.

One of the first serious outbreaks was recorded at the Yambuka Mission Hospital in the Democratic Republic of Congo in 1976 when 318 cases of Ebola were identified, of which 280 ended in death – 88% of the victims. In Sudan, during the same year, there were 284 cases and 151 fatalities.

Other outbreaks occurred in the early 1980s, 1990s and between 2001 and 2003. Then came 2014, with an alarmingly increased number of cases and fatalities essentially confined to five West African nations.

But because the outbreak was confined to just five of Africa’s 54 nations, African Angle was dismayed to hear two Western Australians musing over whether it would be safe to attend the Mining Indaba in Cape Town in February next year, “because of Ebola”.

The answer is, of course, a resounding “yes”, it will indeed be safe to visit South Africa – and any other of the continent’s 48 nations. Of course, one has to remember that an infected person stepping off a plane – whether it is in Dallas or Ottawa – still has the potential to pass it on to others.

There’s a second important point about the level of hysteria currently surrounding Ebola. Transmission of the disease is far more difficult than catching a cold by being sneezed on in a bus, and the World Health Organization has all the pointers. Without being too graphic, one has to get fairly close and personal with an Ebola carrier before infection can take place.

The best advice travellers to Africa can take can be found in the words of the Australian federal government’s reassurance slogan following the Bali bombings in 2002: “Be alert, but not alarmed.”

As if Ebola was not enough to scare away foreign direct investment into the African mining sector in 2014, other factors also made worthwhile deterrents.

In Burkina Faso, a coup by the military ousted one of the African continent’s longest serving rulers. The negligently benign President Blaise Compaore got his marching orders in October from a country fed up with Burkina’s continued status as one of the world’s poorest countries, despite the mining and agricultural potential it possesses.

Nothing has changed as yet for the explorers and operators there, nor is it likely to, until a new president is sworn in. Michael Kafando has been acting president since the mass protests led to the military takeover.

In Zambia, the misrule of President Michael Sata came to an end with his death, also at the end of October. While personal sympathy to his family should be offered without question, the mining-investment community will be quietly overjoyed at the prospect that someone more pragmatic and visionary may replace old-school socialist Sata. An election will take place on January 20, after which the troubled caretaker-ship of acting president Guy Scott will end.

Finally, in the powerful but troubled south, the Republic of South Africa has emerged somewhat battered from a year of horrendous industrial action only to be subject to a fresh round of “load shedding” in the latter part of the year.

Load shedding is euphemistic South African-speak for power cuts, which affect different parts of the country at different times of the day or week. A no-no for a mining industry which operates 24/7.

Colourful South African President Jacob Zuma, of course, has side-stepped the clear culpability of two decades of his party’s inattention to upgrading power infrastructure by blaming the electricity shortage on apartheid. This has been seen as a somewhat far-fetched argument to advance, and one that does not wash even with his colleagues in the ruling African National Congress party.

The logical sequence of ‘no power, no mines, no input into the public purse’ appears to be escaping South Africa’s rulers right now.

But it has not escaped the attention of South Africa’s peak mining body, the Chamber of Mines. Usually cautious about criticising the actions of the ruling ANC, this time the organisation has come out a little more boldly.

Chamber president Mike Teke said the industry had already reduced its electricity demand by 10% to assist power utility Eskom to improve its “electricity reserve situation and avoid a complete black out”.

“Although the mining sector contributes only about 7% to the GDP, its non-production has a direct impact on upstream and downstream industries related to the mining sector that contribute a further 10% to the GDP. Production stoppages that are caused by continuous cuts to electricity supply will hurt the industry and the economy as whole. I am concerned that in the mining sector the cost of resuming production is much higher than just cutting electricity supply to a mine,” he said.

The irony is that South Africa is richly blessed with an endless array of power sources – coal, uranium, hydro and renewables – but appears to have neither the managerial skills nor the political will to resolve this problem. The same ineptitude also appears to apply to the more weighty problems of violent crime and rampant corruption – factors which also go a long way to deterring foreign direct investors from making South Africa their adopted home.

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