Jayant Bhandari: Throw Out the Rose-tinted Glasses When You Look at Africa

TL;DR

Mining investment in Africa carries significant political and social risks, but opportunities can still be found by adjusting prices accordingly.

Transcript

I'm Scott Tibbles with the investing news network I'm here today the 2018 international mining investment conference in Vancouver joining me now is giant mandhaari from Anaka capital for joining me John thanks for having me Scott okay so it's day two of the conference how are you finding it so far I enjoy all these conferences I get to know a lot o... Read More

Key Insights

• 😘 The economic base in many African countries is low, making them riskier investment destinations.
• 📽️ Mining projects in risky jurisdictions can still offer opportunities if bought at discounted prices.
• 🇿🇦 South Africa's black economic empowerment policy has drawbacks, leading to unfair distribution and misuse of funds.
• 🌍 International news coverage often overlooks significant problems occurring in third-world countries, contributing to a lack of awareness about risks.

Questions & Answers

Q: What are some of the risks associated with mining and investment in Africa?

The speaker points out the low economic base, tribal warfare, and the potential civil war in South Africa as major risks. These factors can affect the profitability and stability of mining ventures.

Q: How should investors approach mining investments in risky jurisdictions?

Investors should adjust their prices to reflect the political and social risks in these jurisdictions. By buying projects at discounted prices, they can position themselves for higher returns if successful.

Q: What is the speaker's opinion on the black economic empowerment policy in South Africa?

The speaker is critical of this policy, as it requires companies to allocate positions and shareholdings to individuals without considering their competence or ability to contribute financially. He believes it ultimately results in the misuse of funds.

Q: How does the speaker view international news reporting on third-world countries?

The speaker suggests that international news tends to overlook problems in these countries and romanticize certain events. He mentions the selective coverage of conflicts and civil unrest, particularly when the affected minorities are white.

Summary & Key Takeaways

• The speaker discusses the current situation in Africa, highlighting the low economic base and tribal warfare in many countries.

• He emphasizes the importance of buying mining projects in risky jurisdictions at discounted prices to account for political and social risks.

• The speaker criticizes South Africa's black economic empowerment policy, which he believes leads to the allocation of positions and shareholdings to politically connected individuals.