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Overblown expectations of the mining sector

Resource type
Author/contributor
Title
Overblown expectations of the mining sector
Abstract
The government of Mozambique remains confident that its mining boom is set to accelerate in the coming years, despite weak sentiment in the global mining industry. Rising coal production and an eventual rebound in global prices will spur some growth in Mozambique's mining sector in 2016‑20 but we expect that, weighed down by infrastructure deficits and non-competitive policies, it will remain a relatively small contributor to GDP growth. Mozambique has untapped coal reserves estimated to be in excess of 20bn tonnes, as well as commercial quantities of aluminium, gold, titanium, graphite and gemstones. Plus, it benefits from a long coastline and geographic proximity to mineral-hungry markets in Asia. At the peak of the commodity super-cycle, investor interest in Mozambican mining soared; the contribution of the mining sector to GDP increased from 1.6% in 2009 to 3.2% in 2013, while government earnings from the sector swelled from US$40m in 2009 to over US$1bn in 2014.
Publication
Economist Intelligence
Date
2016/02
Language
English
Accessed
04/11/2021, 22:22
Citation
Economist Intelligence. (2016, February). Overblown expectations of the mining sector. Economist Intelligence. https://country.eiu.com/article.aspx?articleid=2014788585&Country=Mozambique&topic=Politics&oid=274433211&flid=1453928529
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