Mali recovers $1.2 billion in arrears from miners After sweeping audit

By: Chidozie Nwali

Mali has successfully recovered 761 billion CFA francs ($1.2 billion) in arrears from various international mining companies, a massive financial clawback announced by the government following a comprehensive audit of the country’s vital gold sector. The recovery, which significantly exceeded the government’s initial target, marks a major win for the military-led administration and its push for greater resource sovereignty.

Mali Economy and Finance Minister Alousséni Sanou announced the figure on state television, confirming that the collection efforts stemmed from a sweeping audit launched in early 2023. The audit, conducted by firms Inventus and Mozar, flagged widespread financial irregularities and “massive shortfalls” in payments owed to the state, initially estimated to be between 300 billion and 600 billion CFA francs.

As one of Africa’s top gold producers, Mali relies heavily on the sector for export earnings and fiscal revenue. For years, critics argued that previous mining contracts favored international companies over the state, resulting in billions of dollars in lost income.

The government subsequently formed a recovery commission to pursue back taxes, dividends, and other unpaid dues from operators. Several major players, including B2Gold, Allied Gold, Resolute Mining, and Endeavour Mining, have settled their arrears and agreed to operate under the new regulatory framework. Australia’s Resolute Mining Ltd. previously agreed to pay approximately $160 million to resolve a long-standing tax dispute.

While the exact contribution of all companies to the $1.2 billion total was not fully itemized by the Minister, the overall recovery dramatically surpassed the government’s expectations.

“I am delighted with these results, among which we can mention the recovery of 761 billion CFA out of a target of 400 billion.”  Alousséni Sanou said.

The successful collection of arrears has coincided with, and paved the way for, the implementation of a new and stricter Mining Code, adopted in August 2023. This new legislation is projected to substantially increase the state’s annual revenue from the sector.

The state’s minimum stake in new producing assets has been raised from the previous 20% to a potential 35%, combining a 10% free carried interest with the option to purchase an additional 20% and a 5% stake for the Malian private sector.

The new code scraps the stability clauses in previous contracts, which shielded companies from new taxes or regulatory changes, thus giving the state more flexibility to adjust terms as needed.

Minister Sanou highlighted that the new code is expected to raise the annual revenue from the audited firms alone by 586 billion CFA francs, bringing their total annual contribution to the national budget to approximately 1.02 trillion CFA francs ( $1.6 billion) each year.

The move signals a firm policy of resource nationalism by the Malian authorities, prioritizing domestic financial gains from the nation’s mineral wealth. The renegotiation committee stated its goal was not just to recover funds but to ensure the state has a “sizable stake” in all mining contracts moving forward.