China, which has zeroed in on Africa for rare earth mining, could be worried as the landlocked Burundi bordering Tanzania and Kenya decided to suspend operations of several existing international miners. The Burundi government has decided to reset the terms of agreement with the foreign rare earth mining majors so that the benefits can be reaped by the locals as well.
According to news agency AFP, Burundi’s Mines Minister Ibrahim Uwizeye said that the decision was taken due to numerous failures regarding the country's mining code.
"The state, which owns the soil and minerals, is not making a profit as it should," the news agency quoted a letter sent to the companies. Uwizeye has also said that the mining are "unbalanced".
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“China is the largest player in rare earth minerals and it is an interesting development that a small country like Burundi has decided to renegotiate the terms and conditions of the agreements,” Subhomoy Bhattacharjee, Senior Adjunct Fellow at RIS (Research and Information System for Developing Countries) told India Narrative. However, Bhattacharjee added that Burundi will require support of other larger umbrella organisations such as the Organisation of Africa Unity.
An analyst said that though the move is primarily targeted at UK-listed Rainbow Rare Earths, it could be a warning signal for all the other foreign rare earth mining companies. About seven foreign rare earth mining majors are operating in Burundi. These companies are Chinese, Russian or British.
Burundi witnessed a change of guard last year with President Evariste Ndayishimiye assuming office much ahead of the schedule following his predecessor Pierre Nkurunziza’s death.
Ndayishimiye has promised to weed out corruption and also reduce interference of foreign hands in the internal political spectrum. The major Chinese rare earth mining companies include China Shenhua Energy Co, China Coal Energy Co, Zijin Mining Group, China Northern Rare Earth Group High-Tech, Shandong Gold Mining among others.
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“Chinese interest in Burundi’s rare earth minerals has drawn Beijing largesse to Burundi, including training in tilapia production for the African country’s fish farmers,” Seafood Source said.
Burundi is sitting on a pile of rare earth minerals, which include lithium, scandium, graphite, and gallium. The online business platform noted that a large chunk of the rare earth minerals mined in Burundi and other parts of Africa are exported to China.
“China has ignored the environmental issue in developing and mining rare earth,” Satoru Nagao, fellow at Hudson Institute told India Narrative.
“That is the reason China can mine rare earth and dominate the world market,” Nagao said, adding that Beijing has shown little regard for issues relating to human rights as well as the environment.
However, Chinese President Xi Jinping has left no stone unturned in trying to keep the Burundi administration happy. He even had a phone conversation with Ndayishimiye in March. According to the Chinese foreign ministry, Xi stressed that China is keen to work with Burundi to enhance political and inter-party communication, deepen exchanges and cooperation between legislatures, local governments and think tanks, increase sharing of governance experience, and better synergize development strategies, so as to realize mutually beneficial cooperation and common development at higher levels and lift China-Burundi relations to new heights.
China, which overtook the US to become the top global producer of rare-earth metals, accounts for some 90 per cent of the material. About 35 per cent of the world’s reserves of rare-earth metals are found in China but Beijing has set its eyes on the African reserves.
“Though Burundi is a small country, it will be interesting to see what happens to the rare earth miners,” the analyst said.
