BAMAKO (Reuters) -Mali adopted a new mining code on Tuesday that mining sector officials said would channel a greater share of revenue to state coffers and increase state and private Malian interests in new projects.
The government announced the review of the mining code in January after it said an internal audit had shown that Mali, one of Africa’s biggest gold producers, was not receiving a fair slice of profits while granting too many tax breaks.
The new code now allows the government to take a 10% stake in mining projects and the option to buy an additional 20% within the first two years of commercial production, mining commission chairman Assane Sidibe told reporters.
A further 5% stake could be ceded to locals, taking state and private Malian interests in new projects to 35%, from up to 20% today.
Meanwhile certain tax exemptions have been abolished, Sidibe said.
International miners in July said they were in talks with the government over new rules for the sector that has remained attractive despite coups and a deadly Islamist insurgency.
The approved code would generate an additional 500 billion CFA francs ($803 million) per year for the state and increase the mining sector’s contribution to the economy by up to 20% of gross domestic product, from the current 9%, Economy Minister Alousseni Sanou and Mines Minister Amadou Keita said.
Barrick Gold, the world’s No. 2 gold miner, and Canadian rival B2Gold are among the biggest producers and have been expanding output in Mali, even amid frequent changes in government and rising insecurity.
($1 = 622.7300 CFA francs)
(Reporting by Tiemoko Diallo; Writing by Sofia Christensen and Alessandra Prentice; Editing by Alex Richardson)