Tuareg rebels in Mali now control much of the country's north.

Formerly a relatively stable and robustly democratic country, Mali has been thrown into chaos after an uprising by the Tuareg minority in the north in turn sparked a military coup and led to increased al-Qaeda involvement in the country.

This upsurge in violence has had knock-on effects on business, reducing investor confidence and disrupting trade and exports.

So far, however, the country’s important lucrative gold mines in the  south-east remain largely unaffected by the recent troubles and briefly-imposed sanctions against the country have now been lifted.

Tuareg uprising

Tuareg rebels in northern Mali launched an uprising against Mali’s government in January, leading to a successful coup in March by soldiers and low-ranking officers disgruntled with what they saw as poor handling of the uprising by the government.

The confusion caused by the coup, however, has strengthened the Tuareg rebels, who seized the initiative and intensified their offensive, leading to the government losing control of much of northern Mali, the opposite effect of what the coup-organisers had wanted.

In consequence, the Tuareg rebels of the National Movement for the Liberation of Azwad (MNLA), supported by Islamist groups such as Ansar Dine, have capitalized on the political uncertainty in Mali to seize control of the northern provinces of Kidal, Gao and Timbuktu.

Mali government in disarray

Rebel groups currently continue to entrench their rule in northern Mali, strengthened by weapons flowing from Libya. Although a transitional government has been established in Bamako, there is no agreement on how to re-take northern Mali from the rebels, with division emerging between civilian and military members of government. This disagreement on policy reduces the likelihood of the Malian government finding a resolution to the conflict by itself.

At the same time, however, divisions have developed within the Tuareg forces, notably between almost secular Tuaregs seeking self-rule or succession in northern Mali and Islamist militants who aspire to impose Sharia law rule throughout Mali.

At present, southern Mali remains relatively calm, however giving the intensifying levels of governmental disarray within the country, the increasing strength of rebels in the north, and the increasing involvement of external regional actors, this region is also increasingly threatened by a possible spread of violence. .

External intervention discussed

The growing threat of violence from Islamist groups throughout the region increases the possibility of military intervention in Mali by an external regional force.

For instance, the potential secession of northern Mali has alarmed the country’s neighbours. Meanwhile the presence of hard-line Islamists among the Tuareg rebels has led both Niger and France to express fears that international terrorist groups such as Al Qaeda could establish bases in northern Mali and destabilise the entire region.

A military intervention by the Economic Community of West African States (Ecowas) was discussed during the group’s meeting in Abidjan on 8 June. France has also separately expressed its willingness to contribute to an intervention. However questions remain about how to achieve broader backing from international actors, notably the UN and other African states with some countries like Algeria stating their opposition to any external intervention.

At the same time, in recent days there have been signs that the Tuareg rebels are willing to talk. For instance on 18 June, Blaise Compaoré, Burkina Faso’s president and regional mediator, met with members of Ansar Dine as part of regional efforts to seek a mediated solution before pursuing a military approach and to persuade the Islamist group to disassociate itself from al-Qaeda.

Key questions for investors and business will be whether a negotiated settlement to the conflict is possible, to what extent Ansar Dine is willing to water down its hard-line agenda, and whether the current violence and instability will ultimately reach south-west Mali, potentially disrupting gold mining operations and key supply chains and trade routes there.

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