Thursday, 2 December 2010

News Digest: Africa Mining Comment & Analysis – Liberia

President Ellen Johnson-Sirleaf's office confirmed on 25th November that Mines Minister Eugene Shannon would not be recalled to government and would be replaced by former minister for posts and telecommunications Roosevelt Jayjay. Johnson-Sifleaf sent the entire government on 'administrative leave' in October ahead of an expected shake-up, although six ministers have already been appointed. Richard Tolbert – the head of the National Investment Commission and another key player in resource deals – resigned following the announcement of the government's suspension.

Chris Melville, Africa mining consultant with Menas Associates today commented:

“A year ago, the removal of Shannon and Tolbert would have been unthinkable, given quite how close they have been to Johnson-Sirleaf. However, it is clear that widespread – if unproven – allegations of corruption against the two have made them an electoral liability for the president and her party. Shannon's failure to secure the senatorial nomination in his home district was a clear indicator of that.”

“Given their centrality to a number of major deals over the past few years, the departure of Shannon and Tolbert could be unsettling for the Liberian extractives sector. However, they seem to have consented to their removal and both are likely to remain influential behind the scenes.”

“A geologist by training, Shannon has overseen the transformation of Liberia into one of the most interesting and prospective mining frontiers in West Africa. However, unsatisfactory audits of the mines ministry and allegations of graft in certain licence auctions have coloured his reputation for probity and undermined one of the central platforms of Johnson-Sirleaf's 2005 election campaign.”

“Ellen now faces a real juggling act ahead of the 2011 election – the opposition is gaining momentum and her credibility has been somewhat eroded by four years in power. Keeping resource mega-projects on track – especially the ArcelorMittal project, which is due to start producing in July 2011 – could be crucial.”

© 2010 Menas Associates

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