Established on July 27, 2022, the reference price applicable to the sale of bauxite will come into force on Thursday, September 1, 2022. Since the majority of producers in Guinea (80%) sell on the Chinese market, Guinean bauxite will be listed on the Guinea LT index on the CBIX in China, the world’s main market for the sale of bauxite.
Noting that previous mining administrations were content simply with the declarations made by the companies themselves for the sale of their bauxite, without any legal basis for the approval of the declared sale prices, the transitional authorities decided to impose a price of reference to all mining companies exporting Guinean bauxite.
According to a study by the Department of Mines, the undervaluation of the price of bauxite, combined with the tax exemptions granted to mining companies, generated revenue losses estimated at around US$250 million for the 2019 financial year and US$350 million of US dollars for the 2020 financial year, tax optimization aside.
The entry into force of the benchmark price institution on bauxite is projected to bring in revenue of US$1 billion in 2023.