Journal of Political Risk, Vol. 10, No. 8, August 2022
Randfontein Mine, Johannesburg, November 2014. Source: Paul Raad via Flickr.
Ndzalama Cleopatra Mathebula Institute of Risk Management South Africa
Generally defined, political risk is the expected cost or loss incurred by a business due to political decisions, events, and actions. With the evolution of the discipline, it is not only government or organizations that can generate political risks, but also labour unions and civil society that can emanate risks. The South African mining sector includes abundant political risk yet is an attractive investment destination given its large platinum, gold, and coal reserves.
Journal of Political Risk, Vol. 9, No. 6, June 2021
Mineral Map of Afghanistan. Source: USGS
Priscilla A. Tacujan, Ph.D. Analyst for the U.S. Department of Defense
Various players have raised the prospect over the years of Afghanistan developing its mineral wealth as a means to stabilize the country, but nobody believes that it could achieve enough security to prevent attacks on infrastructure and mining operations. However, it is possible that Afghanistan might be able to broker peace and reconciliation through a mineral revenue-sharing scheme that directly distributes mining dividends and profits to the general population as well as extract concessions from the Taliban — an approach that has helped mitigate conflict in some other war-torn areas where revenue-sharing has been part of their peace accords. A trickle-down incentive structure could incentivize the Afghan people and militant groups to pursue peace and reconciliation if they become vested stakeholders and direct beneficiaries of their country’s natural resources. While security conditions in Afghanistan’s extractive industries remain a challenge, a review of successful revenue-sharing practices in other countries suggests that a similar practice in Afghanistan may yield long-term gains.
Long considered an anchor of East African stability, Tanzania has recently made headlines for aggressive expansion of its mining and extractive industries. In what might be considered growing pains, economic prosperity has strained government and civilian relations, and is increasingly testing the governance skills of Tanzania’s Ministries. Adverse investment laws, widening religious conflict, and proliferation of small arms and light weapons, however, tarnish Tanzania’s image as a peaceful and prosperous republic. Continue reading →