The courage to Guinea can lead to a deficit and rise in price of iron ore, writes CNBC. After coming to power of the military, the development of the world’s largest field in the world can delay the years.
The largest unauthorized railway deposit is located in the mountain range to Simand in the south-east of Guinea. It was opened in the 1990s, but the mining of the fossils has not yet begun because of the uncomfortable location of Simand – Mountains are located away from the capital of Conakry. According to the International Monetary Fund (IMF), huge investments in the creation of railway and port infrastructure are required to implement the project. Guinea, which occupies one of the last places in terms of GDP per capita, is unable to organize a construction site without the help of investors. The turbulent political situation will worsen the prospects for the development of the field, considers the analyst according to the company CRU Group Andrew Gadd. He recalled that difficulties with attracting investments were observed in a calm time for Guinea. Now it will be even harder to find sponsors.
On September 5, the group of military arrests the current President Guinea 83-year-old Alpha Konde and announced the seizure of power. The leader of the rebels Colonel Mamadi Dumbai declared the suspension of the Constitution and the dissolution of parliament and the government. The reason for the rebellion, he called a desire to deal with the corruption of higher circles and poverty of the population. President Konde occupied his post in 2010, having spent two five-year period in power. In 2020, he conducted a referendum to change the Constitution and claim the presidency for the third time. After the elections in October 2020, Konde again elected head of state.
After changing the power in Guinea, world prices for aluminum updated the ten-year-old maximum, reaching the price of $ 2727 per ton. Bauxite mining in Guinea provides production about 20 percent of aluminum. The head of the Metallurgical Company “RUSAL” Oleg Deripaska stated that the situation that had arisen could greatly shake the global aluminum market. According to the latest data from the London Metal Exchange, aluminum is trading at a price of $ 2745 per ton.