Q: I am a disappointed MOZ shareholder. Now that I am a CXB SHAREHOLDER, I am exposed to Nicaragua. What art your thoughts on the political exposure??
5i Research Answer:
There is definitely added risk when a company operates in a more unstable political environment, but in the mining industry this is often unavoidable due to the reliance on operating in country's which have political instability (ie where the deposits are). We don't see it as an immediate problem but would definitely keep a closer eye on the political backdrop and if there are any direct affects on CXB. Nicaragua is not perfect, but is better than many countries in terms of mining regulations. In addition, the stock's valuation does relfect at least some of this risk.