London Mining with its iron ore assets in Sierra Leone is a favourite of both Peter Lees and myself and held in our UK Alpha and UK Equity Income Funds.  We both own the equity and I also own the convertibles in the income fund aiming for the best of both worlds.

Having visited the London Mining operations in Sierra Leone a few months ago I was keen to attend last week’s seminar on investing in the country hosted by the High Commissioner to the UK and the Ministers of Finance and Economic Development, and Trade and Industry.  Henry Bellingham MP, the Africa Minister in the Foreign and Commonwealth Office was also there. 

As an existing investor in London Mining I wanted to hear what was said about foreign investment into the country, as their overall approach in this area would likely impact on the value of my holding.

The news was very positive with the government making clear its intention to promote foreign investment in three key areas, agriculture, tourism and mining.

What was also reassuring to hear was the progress the country is making in terms of transparency and corporate governance.  In a recent World Bank Report* Sierra Leone was identified as one of the most improved areas for doing business as a result of economic reforms put in place across the country now that the civil war is over.

Iron ore is the key asset for London Mining and the development of this resource is also crucial to the GDP and health of the domestic economy.  The start of production from two iron ore projects (including London Mining’s Marampa asset) in December 2011 will likely see the country’s GDP increase from $2.1bn to $3.4bn, over 60% in 2012.  If only George Osborne could engineer such growth all our debt problems would be over!

* World Bank – Doing Business 2010 - Doing Business in a More Transparent World