I dont believe the various rebel skirmishes are the main problem with the political environs in the drc stonep.They are just designed to keep the locals and businesses on edge and will be kept under control if the UN keeps a decent presence in the NE drc.Only downside with these conflicts is if these groups decide to move operations but with the cutting of financial and arms backing to these groups I doubt this will become an issue.
The main problem will be the workability of the interim and democratically? elected governments and to what effect these have on already established laws and covenants.Obviously the mining laws being the major issue as far as any international companies are concerned.This is where the major risks lie for the frontier companies in the DRC as any of these types of politically unstable countries are very suseptible to sudden policy changes and the political influence of non-government organisations(NGOs).Just ask BHP and RIO about Indonesia and their recent pullout from the very profitable coal venture in East Kalimantan.Also Placers problems with NGOs in East Borneo and how much of a barrier these small groups can be to getting major projects off the ground.I watched the recent report on the DRC on Foreign correspondent the other night(as all AVL holders shouldve).I cant remember the exact figure but the last count of different ethnic groups in the drc was in the thousands.So even if you were to halve this you would still end up with a pretty impressive number of NGOs that would have to be consulted if one was to get a project up and running.If the country can establish a national and regional political system that ignores ratial and ethnic differences then there may be some hope.
Theres absolutely no doubt AVLs had balls of steel to do what they have done in the DRC but I can certainly understand why theyd want to tie down something outside the drc as this countries politics will be an issue for any company,even in the long term.
Its all about seeing the cash with AVL and nothing more.As long as they are in the drc they will always be branded with a very high level of political risk.Thems the breaks and I think anyone is being totally unrealistic if they think any of that risk percentage is going to come off the stock in the near term.
I was told a while back that markets value a company on expectation.As far as avls concerned I think the markets working on the expectation that the politically issues have a long way to go before they sort themselves.
Personally I would like nothing more than to see a good stable transition to a democracy.But as long as you have tinpot regiemes with people like Mugabe running them the politics will always be a major problem when assigning a value to a company in such a risk averse environment no matter what positive spin you might see from analyst reports or the media.
