Danakali Needs a Dictator’s Support

John Robertson


Danakali could validly claim to have the best resource development potential of any ASX-listed company - perhaps, as its CEO says, comparable to the Pilbara in 1960. Its biggest investment headwind is its location: Eritrea. CEO Paul Donaldson was at pains to show, in presenting to investors this week, that Eritrea gets a bad rap. Don’t trust Google, he says. There is no corruption. There’s no war with neighbouring Ethiopia. The government is keen to raise living standards and has worked cooperatively to improve infrastructure. Disappointingly, accepting all of that, Donaldson did not mention once in 30 minutes that the government is headed by a 70 year old president who took control forcibly in 1993, abandoned the constitution and refuses elections. One man’s dictatorship is another man’s stable government, until it is time to change. Some of the world’s staunchest democracies are currently fumbling their way to new leaders. How is it going to happen in Eritrea? Answer: no one knows and, right now, no one wants to ask. That’s what makes me nervous about an otherwise outstanding development opportunity.

John Robertson is Chief Investment Strategist for PortfolioDirect a provider of resource sector investment stock ratings and portfolio strategies for mining and oil and gas investors. He has worked as a policy economist, corporate business...


No areas of expertise

I would like to

Only to be used for sending genuine email enquiries to the Contributor. Livewire Markets Pty Ltd reserves its right to take any legal or other appropriate action in relation to misuse of this service.

Personal Information Collection Statement
Your personal information will be passed to the Contributor and/or its authorised service provider to assist the Contributor to contact you about your investment enquiry. They are required not to use your information for any other purpose. Our privacy policy explains how we store personal information and how you may access, correct or complain about the handling of personal information.