Credit Crisis Hits African Projects

The rush to exploit Africa's vast reserves of natural resources is expected to slow dramatically as the current financial crisis forces sharp cutbacks in exploration budgets. A weakening outlook for African oil is already being seen. Major mineral projects on the continent are now expected to be postponed or scrapped altogether as mining firms confront the twin blows of decreasing demand for raw materials and unfavorable financing terms.

The impact of this credit crisis on the leading economies Africa will be enormous, where mining activities have accounted for signifcant recent growth. The downturn is expected to hit mineral-rich Guinea and Congo (DR) especially hard.

> Financing pinch may squeeze Africa mining projects [Reuters]

Financial Crisis Spurs Commodities Slowdown

"Is it the end of the party for natural resources?" This is the question that BusinessWeek poses today, and it's a legitimate one considering all that has happened in the global financial markets in the last couple of weeks.

It might be tempting to abandon all hope in the markets given the current economic climate, but I'm inclined to say no, I don't think that the commodities boom has seen its end yet. It's true that slowing demand for raw materials has resulted in price weakness for many metals, but I think large industrial projects in both China and India will power sustained growth for the sector in the long term.

> Mining Tries to Dig Its Way Out [BW]