WAF valuation, page-180

Hey Mossberg, interesting find and many thanks for the heads up.

On the surface one might be concerned by the 'political upheaval' during a time of sadly increasing ethnic/religious violence and of course the sad loss of western hostages recently. On the contrary, I would be more concerned if nothing happened.

I see it that the real power, President Kabore, has thrown his prime minister under the bus as a sacrifice to the loss of control and international spotlight now turned onto this countries troubles. Call me cynical but this looks like a golden opportunity for President Kabore to leverage this international attention and it's desire to prevent the march of Islamic extremist scourge. Attention duly gained with a sign of good faith, brings about a change of the government's approach to the incursions from Mali and civil conflict. That is, on the front foot with the military and at least secure a border (probably internal) through which to firstly arrest the expanse of Islamic terrorism and push back to a no go zone.

The international community, with the recent spotlight, takes seriously the need to protect even the worlds poor from the spread of this catastrophic disease. International support of Burkina Faso's counter Islamic defence seems a no brainer to anyone not memorised by embarrassing internal US politics. Regardless, expect a hard military response which will garner more international attention which, if the journos do their job, should bring about even more support and assistance.
 
Yes, I hear you, when was the last time a conflict against Muslim extremists went well? Agreed, a permanent solution will not be quick or pretty in the regions involved. However, the ethnic and religious tensions are absolutely based around the semi-arid nomadic Muslim herders in conjunction with the more seriously armed and fanatic Mali jihadists. However, there is such a strong east-west line in the Sahah region near the northern border. There is absolutely no reason or support for a move southwards from that line towards Sambrado in the centre. Certainly the government or international community don't want it.

Is not pretty and it does carry country risk. Always did of course but to me there are two type of African country risks. First is the usual change of ownership/royalty conditions be it democracy, dictatorship or change of regime. The other is physical in the sense of wars, conflict, crises and the usual force majure. I fear worse the former and most common. The latter is a much more logical proposition to factor. Sorry for rambling but I am getting to a point. The Presidents action today sends a message that an east-west line has been drawn in the sand near the northern border and a new tough government is coming to guard it. 

Now I feel badly for the poor villages wrong side of that border and surrounded by Islamic bad guys, I would get out with my family if didn't want to join them. But that sort of contained conflict is a long way from where a royalty, tax and job creating new gold mine is located. The government represents maybe 90%+ of the population that side against the terrorists and isn't go to allow this conflict to come that far south or even interfere with business as much as possible. International finical support will simply disappear if they start nationalising mines, so better to keep in the good books, protect the mines, jobs, economy and tax receipts while enjoying international support. 

Don't think I've been too subtle in making my opinion known, everyone's got one although like assholes they mostly stink. The situation is not perfect but any serious consideration shows that Sambrado is located in a geographically safe area, backed by a democratically elected government representing 90% of the people, over a conflict that has clear ethnic, religious and geographical boundaries unlike the mess that was Syria for example. Against the mainly psychological 'conflict' negative is the likely international support and the attention, which should reduce the 'government greed' risk. Everybody wins out of building a gold mine while the gold price is good and security a long way from conflict should be pretty cheap and secure.

That's my view anyway, the market might see it differently. Long term holders should be rewarded buying any weakness because raiders and pirates look for cheap ounces, undervalued situations. After doing a thorougher due diligence I'm sure they'll recognise WAF is a fully funded bargain.

Good Luck