Rwanda mining sector recorded a major plunge in revenue earnings in the first half of 2009, compared to the first half of 2008.
This drop comes at the back of falling demand on the international market fuelled by the global financial meltdown.
It is reported that the global meltdown forced companies that used to consume Rwanda’s minerals to scale down production, a move which has led to low demand for minerals.
As a result, information from Rwanda Central Bank indicates that there was a 47.5 percent drop in revenue and a 22 percent dip in volume of the minerals exported from January to June this year.
Last year, the minerals brought in $94 million compared to the $72 million earned in 2007.
Rwanda Geology and Minerals Authority is however optimistic that the sector will soon recover basing on news that economies are recovering from the financial woes that earlier slowed world economic growth.
The authority advises that it is prudent to base planning for the sector on a normal ‘year’ rather than an extra ordinary one. The general trend is of sustained growth.
“This drop might be a disappointment and may raise questions whether the industry is worth any great focus or whether it is largely speculative,†Michael Biyabarema, Director General Rwanda Geology and Mining Authority recently wrote in Rwanda’s The New Time.
According to Biyabarema, Rwanda is part of the Kibaran rock system which is rich in minerals deposits. The Kabaran extends from northern Tanzania through south-western Uganda, Rwanda, Burundi, eastern parts of Democratic Republic Congo and Zambia up to Angola.
Geologists say this rock system contains numerous granite-related ore deposits, which are rich in mineral ores like cassiterite (SnO2), niobotantalite (Nb,Ta)2O5, wolframite (Fe,Mn)WO4, beryl, spodumene, amblygonite, monazite, gold (Au).
It is also estimated that Rwanda has 155 MT of dry peat deposits but geologists say other reserves exist. Peat is used in burning limestone for lime production, firing bricks, tiles and cooking.
Rwanda has recently given priority to the mining sector with a hope that it will become top foreign exchange earners. Already nine mineral cleaning and mineral dressing facilities have been established in the country.
Wolfram Bergbau (producing 14 percent of world tungsten), Schtack and Niotan Ltd are some of the international companies involved in the Rwanda mining sector.Â
There is a new mining law which generally sets standards and creates a level playing field for stakeholders in mining. It emphasizes exploration before mineral exploitation.
According to Biyabarema, the country is also coming up with new mineral policy to favour investments.
An airborne gravity survey of the entire country was carried out last year to ascertain the country’s mineral potential. The last mineral exploration had been carried out in the 1980s. This means there was need to update the national potential.
Whenever he meets potential investors, State Minister for Minerals and Natural Resources, Vincent Karega, has always drawn attention to potential that exists in the Rwandan mining sector.
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