ASMARA (Reuters) - Eritrea’s long-serving president, Isaias Afwerki, dismissed suggestions that a highly anticipated mining boom was about to boost the economy and change the lives of ordinary Eritreans.

“It is more than misguided, it is cheating and deceiving people,” he told Reuters in an interview on Wednesday on the outskirts of the capital, Asmara.

“I personally don’t think that gold is going to change much in the performance of the economy. It is a distortion about the future.”

Much hope was pinned on the potential of the nation’s mineral sector, whose agriculture-based economy has suffered from the effects of irregular rainfall and the global crisis.

Apart from small-scale artisan mining and minor extraction by Italians during the colonial era, Eritrea’s mining potential is unexploited. Bigger miners were scared off by the 1998-2000 border war with Ethiopia.

Gold, zinc and copper are the main interests.

The Bisha project, run by Canadian explorer Nevsun Resources with a 40 percent stake, is Eritrea’s most advanced project. Its 27 million tonnes of ore are believed to contain 1 million ounces of gold, 700-800 million pounds of copper and 1 billion pounds of zinc. Production is expected by late 2010.

Isaias insisted, however, that proper economic development, and tangible improvements for Eritrea’s 4 million people, required more than just striking gold.

“(Gold) is not a resource that will dramatically change the quality of life in this country,” he said. “It would be very damaging to expect improvement in the economy because we are mining gold. I have never entertained that idea.”

Foreign miners insist on the sector’s potential, but Isaias cautioned that it must be developed slowly and carefully to prevent the so-called “resources curse” where oil and minerals have spawned corruption and violence elsewhere in Africa. Source: (Reuters)

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