AngloGold Ashanti (NYSE:AU) CEO Mark Cutifani said in an interview today that the 40 percent super tax being proposed by Australia puts their sovereign risk much higher than South Africa.
Cutifani said, “Sovereign risk in Australia is higher than South Africa. Australians are horrified. It potentially damages the industry. It’s a great opportunity for South African industry.”
Another CEO of a South African gold miner, Nick Holland of Gold Fields (NYSE:GFI) agreed, saying it's a "highly negative" tax for Australia.
Many mining companies are reevaluating their expansion plans in Australia as the proposed 40 percent tax would be implemented in 2012, which the country thinks will raise $12 billion.
South Africa and other countries could be strong beneficiaries of the super tax, as the industry looks elsewhere to do business in light of the measures that will most likely be put in place.
The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com