CONAKRY, Guinea – Lt. Col. Mamady Doumbouya, Army Special Forces chief and coup leader, waves to the crowd as he speaks ahead of a meeting with ministers of the Ex. Arrives at the People’s Palace in Conakry -President of Guinea, Alpha Conde.
CELLOU BINANI / AFP via Getty Images
A military junta claimed to have taken control of the West African country of Guinea and arrested President Alpha Conde, creating uncertainty over important bauxite and iron ore supplies.
The coup, carried out on Sunday by an elite special unit led by 41-year-old Col. Mamady Doumbouya, is the latest in a series of seizures of power in the region last year, including in nearby Mali and Chad.
Doumbouya has claimed the army was forced into action amid rampant corruption, human rights abuses and economic mismanagement under Conde, but the move has been condemned by the United Nations, the African Union and the regional organization ECOWAS.
The elite unit on Monday allowed travel to resume through checkpoints in the capital, Conakry, banned government officials from traveling abroad and lifted curfew in mining areas
In addition, it has endangered minerals and mining companies, which are vital to the country’s economy and global supply chains, according to experts.
Guinea’s 110-kilometer-long Simandou Mountains are home to one of the largest undeveloped iron ore deposits in the world, holding more than 8.6 billion tons of ore with an average iron content of 65%, according to the country’s National Institute of Statistics.
Simandou is in the remote southeastern interior of the country, far from Conakry and the west coast which must be reached to gain access to the global maritime market for iron ore.
“The infrastructure requirements of the project are therefore enormous in scale, complexity and cost, and in every way larger than the bauxite export industry that has been established in the country in recent years,” said Andrew Gadd, senior steel analyst at CRU Group.
“Geopolitical risk has been one of many hurdles that have hindered Simandou’s progress so far, and the military coup now unfolding in the country means a marked deterioration in the prospects for successful development of the deposit.”
The Simandou project has stagnated since its discovery in the 1990s due to political uncertainty, disputes over mining rights and cost concerns.
The project would require massive rail and port infrastructure in a country that ranks 160th out of 186 countries in terms of GDP per capita, according to the IMF. With the ongoing risk of material prices falling, investors were reluctant to take a leap of faith.
Despite recent advances in preparatory work, the project still needs to be feasible.
“Raising funding for Simandou has proven very difficult and the uncertainty created by current developments will challenge the commitment of interested parties,” said Gadd.
Guinea has the world’s largest reserves of bauxite, the world’s most important source of aluminum. Aluminum prices rose to a 10-year high on the London Metal Exchange on Monday amid fears of a global supply disruption.
“The situation couldn’t come at a worse time for the country’s booming mining sector. Miners now have little choice but to sit still and wait for further clarification from the transitional authorities, but contract renegotiations or even expropriations cannot be ruled out, “said Eric Huphery-Smith, Africa analyst at risk intelligence firm Verisk Maplecroft.
KAMSAR, Guinea – View of the bauxite factory of Guinea’s largest mining company, Compagnie des Bauxites de Guinee (CBG), in Kamsar, a city north of the capital Conakry, taken on October 23, 2008. Guinea is the world’s leading exporter of bauxite? , an ore from which aluminum is extracted.
GEORGES GOBET / AFP via Getty Images
“The result will be a major disruption to the global bauxite market as operations are likely to remain closed for the next few days and possibly weeks.”
The Kremlin said Tuesday it hoped the coup would not harm Russian business interests in Guinea, Reuters said.
Russian aluminum giant Rusal has promised to keep its three bauxite mines and one alumina refinery in the country despite the political upheaval.
“Two steps back”
The coup has lifted the curtain on almost a decade of political stability in Guinea. Humphery-Smith said it will likely bolster officer corps across the region, meaning “neither democrats nor autocrats will sleep easy”.
Conde was accused in late 2020 of pushing through a constitutional amendment to secure a third term in office, sparking violent protests across the country.
Cellou Dalein Diallo, leader of the largest opposition FNDC movement originally launched against Conde’s candidacy for a third term, supported the coup in a statement on Monday, claiming the takeover “completes” the work of pro-democratic groups, who speak out against Condé’s retention of power.
CONAKRY, Guinea – A government official escorted by members of the Guinea Special Forces enters the People’s Palace in Conakry, Guinea on September 6, 2021.
Xinhua via Getty Images
“While the feeling of many Guineans is cheering, you can’t be mistaken that this is two steps backwards for both democracy and the country’s economy. Restoring a previously stable and predictable operating environment is anything but natural,” said Huphery- Smith.
The centralized transitional agency would be ill-equipped to respond to local grievances, he suggested, which could potentially escalate political and social unrest when elections are finally scheduled.