biya, page-5

The current president Paul Biya has controlled politics in Cameroon since 1982. When the first multiparty elections were held (1992), he won over his rival by 39% to 36%. The international observers observed unusual extreme and illegitimate actions to ensure the president's victory.

Next election was in 2004. Biya won more than 75%. At that time 8 million people were of voting age, but the registry allowed only half of them to vote. Especially the young voters were disengaged from the democratic process.
Last election in 2007, the results were massively rigged. Finally Biyas party holds 153 of the 180 seats. He used his majority to change the constitution, that h would be allowed to rule without any term limits.

Hefty demonstrations against that amendment of the constitution ended with many scores of people dead and even more injured.
What is the risk now? Of course some possible unrest in connection with the election in Nov 2011. Especially the youth will want their share in the political process and more importantly employment. The current unemployment rate is probably far above 30%.

Biya has indicated, that he does not want to run another term and that he withdraws his son as the next candidate as well. The positive side of this is, that the transitional process in Cameroon starts now. If Biya ran another term, the demonstrations against him could easily get out of control (see Egypt).

Up to here we are talking about the typical risk for those that are investing in Africa. All African countries are like that. That is why it is called the dark continent.

My new concern is, that the new government has to change the politics to specifically satisfy their new voters and especially the young voters. This means they need more money, which in turn could mean they skim that money from the prosperous mining industry.

This again could mean that they become even more favourable to the mining industry (Mining permissions), but then it will be difficult for them to balance the tax and not to stall the business.

When this kind of taxing (as in Australia) becomes a worldwide trend, then we might have even the power to increase the steel prices accordingly. The last is just my speculation.

If it really comes to some unrest in Nov 2011 (in my eyes the likelihood is below 50%), than it will hardly affect SDL, because our building activities start later.

All in all the character of risk is changing but not increasing imo.

Belloh