Nation faces struggle to save mining sector

When foreign mining companies and Western donors were pulling funds out of Madagascar following a coup in 2009, Austral Resources Chief Executive Scott Reid did the opposite and poured money in to the Indian Ocean island.

Yet far from being rewarded, the company's $3.5 million investment in drilling and exploration of a high-grade mine has turned sour. Austral's permit to extract zircon, used in ceramics, has expired and the project is far from production.

Sliding global commodities prices have hindered the Australian company, but to Reid the main frustration has been bureaucracy and government failure to renew its permit, which languishes in the mining ministry with about 4,000 others.