Guinea: Thousands of jobs created thanks to a major development project
Guinea Alumina Corporation launched its first exports of bauxite, a strategic mineral to produce aluminum. Zoom on this monumental project that has greatly contributed to the Guinean economy and created thousands of jobs.
Although Guinea is the world’s largest bauxite mineral resource holder, most of the country’s deposits are currently undeveloped. The construction of a bauxite mine in the Boke region helps the country establish itself as a world-class producer and exporter of bauxite. This project, undertaken by Guinea Alumina Corporation (GAC), a major player in the mining sector in Guinea and a subsidiary of Emirates Global Aluminum, is one of the largest investments in the country in the past 40 years. The mine, whose exports started in August 2019, is expected to produce nearly 12 million tonnes per year. Associated infrastructure has also been developed, including the upgrade of a rail system and the construction of a new port terminal.
This project has a transformative impact on the country with an annual estimate of USD 700 million contribution to Guinea’s Gross Domestic Product (GDP), more than 5% of the country’s GDP. GAC also positively impacts local communities with thousands of job opportunities. Over 4,600 people were employed in the construction of the project at peak, of which more than 85 per cent were Guineans. GAC’s involvement in the region does not end there. The company has invested in drinking water infrastructure, health clinics and schools. Literacy courses and vocational training are also provided to the local population.
This project also plays a role in the energy transition. Aluminum, mainly made of bauxite, has a broad range of unique properties such as its low weight which contributes to develop low carbon products, lighter cars and energy efficient buildings, on top of being highly recyclable. In addition, because of its usage in wind, solar and energy storage, the World Bank has identified aluminum as a major enabler for the transition toward lower greenhouse gas levels. Bauxite is produced by GAC in accordance with the highest sustainability standards, which include the International Finance Corporation (IFC) performance standards, the global benchmark for managing environmental and social risks. This project is a very relevant illustration of how a global shift to climate-friendly technologies can create opportunities for mineral-rich developing countries1.
The partnership we have formed with GAC’s lenders secures the long-term success of our Guinea project and for EGA, this project financing is in line with our capital allocation strategy. We are committed to completing and then operating the GAC project to high standards, contributing to improving sustainability performance in Guinea whilst helping to grow the economy.
Managing Director and Chief Executive Officer of EGA and Chairman of GAC
Societe Generale, with a strong presence in Guinea and throughout French-speaking Africa, was one of the key banks in this project, and acted as Financial Advisor, Original Initial Lender and Onshore Security Agent in this USD 750 million project financing. Societe Generale’s support to GAC, alongside the IFC and the Multilateral Investment Guarantee Agency (MIGA)1, illustrates the bank's full involvement on the African continent, and its desire to contribute to local economic development. Given the growing role of minerals and metals in the energy transition2, Societe Generale also shows through this funding its growing commitment to the fight against climate change.
GAC transaction is the perfect illustration of how Societe Generale can responsibly finance the real economy and contribute to the development of the African continent while, at the same time, unlock the sustainable production of essential minerals being used in innovative climate-friendly technologies.
Global Head of Metals & Mining Finance at Societe Generale