How can Rwanda’s mining sector recover after COVID-19?

The COVID-19 pandemic has paralysed the mining sector with production going down and mineral prices fluctuating on the international market. Rwanda has laid out plans to facilitate recovery, but how long will it take before the sector fully bounces back. Bernard Nsanzimana, Mining Governance Expert joins CNBC Africa for more.

Mon, 15 Feb 2021 15:13:52 GMT

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AI Generated Summary

The COVID-19 pandemic disrupted production in Rwanda's mining sector, leading to reduced market access and lower foreign currency inflow, significantly impacting the economy.
The government has prioritized the mining sector in the economic recovery plan, focusing on reforming and strengthening the sector to attract investments and generate sustainable revenue.
Exploration activities and mineral beneficiation are key strategies in Rwanda's mining sector recovery plan, aiming to attract investors, increase production, and add value to mineral exports.

The COVID-19 pandemic has severely impacted Rwanda's mining sector, leading to a decrease in production and fluctuating mineral prices on the international market. Bernard Nsanzimana, a mining governance expert, shed light on the challenges faced by the sector and the efforts being made towards recovery. The pandemic originated in China, a significant destination for minerals extracted from Rwanda. With factories in China closing down due to the pandemic, Rwandan products faced a diminished market, resulting in reduced production levels. This downturn not only affected workers in the sector but also had a ripple effect on the communities that relied on the income generated from mining activities, including investments and mining companies. The lack of foreign currency inflow from the mining sector, which is the second-highest contributor after tourism, further exacerbated the economic impact felt by the country. The decrease in revenue from mineral exports had a significant impact on Rwanda's economy, affecting its ability to import essential goods. The government, recognizing the importance of the mining sector in economic recovery, has prioritized it in the country's recovery plan. Efforts to reform and formalize the sector have been ongoing since 2018, with the introduction of new mining laws and regulations. The government's focus on strengthening the sector aims to not only revive its previous contributions to the economy but also to attract more investments and generate additional revenue. The recovery plan also emphasizes exploration activities to leverage the untapped mineral resources in the country. By focusing on exploration, Rwanda aims to attract more investors and boost mining activities post-COVID-19. Additionally, the country is looking to add value to its minerals through beneficiation, enabling them to be sold at higher prices. This strategy aims to move away from exporting raw materials to China and instead focus on higher value-added products, ultimately increasing revenue and creating a more sustainable mining sector.