Burkina Faso Passes New Mining Code

Reuters reported that on Friday, Burkina Faso’s transitional parliament passed a new mining code that eliminates a previous 10-percent tax break on the profits of mining companies. Companies must now pay into a local development fund.

As quoted in the market news:

The adoption of the new code, which replaces 12-year-old mining regulations, was among requirements set by the World Bank for the release of $100-million in budget support for the West African country.

The funds were frozen in February pending passage of the new code and an anti-corruption law, which was adopted in March.

The two pieces of legislation had long been called for by donors and among those demanded by protesters who took to the streets in October, forcing veteran leader Blaise Compaore to step down and flee the country after nearly 30 years in power.

Burkina Faso is Africa’s fourth biggest gold producer and the precious metal accounts for roughly 20% of gross domestic product.

Two dozen firms operate in the sector, including Semafo, IamGold and Avocet Mining. They had previously benefited from corporate tax rates lower than other nations in West Africa.

Click here to read the full Reuters report.