Will election results usher in a new era of prosperity for CAR?

The results from the election in the Central African Republic are in and President Bozize has held on to office by a wide margin of victory.

Despite Bozize’s election success, however, it is difficult to get a grasp on where the troubled country in Africa’s heartland may be heading in terms of social and economic development.

On one hand, fears that a close election would cause the country to crumble into a state of chaotic uncertainty have largely passed thanks to the overwhelming victory that Bozize has secured.

With 66% of the vote, Bozize’s support more than tripled his closest rival, past president Ange-Félix Patassé, who secured roughly 20% of the vote.

Such a wide margin means that while the three main opposition candidates unanimously denounce the election process, and say they do not recognize the results, their arguments lack the vigor they would have had if the results were closer.

Still, the three men are launching a formal complaint, albeit one that experts expect to fall flat.

“Even before the announcement of the winner, the opposition said it rejected the results and would go to court,” Thierry Vircoulon, International Crisis Group’s Central Africa director says. “The case will be dismissed of course and Bozize will be re-elected.”

But even with a court endorsement and seemingly widespread support, Bozize will have to play reconciler with the opposition if he hopes to usher in a new era of peace and prosperity for the impoverished country.

One of the key developments to watch for is how he deals with one opposition leader in particular — Jean-Jacques Démafouth.

While Démafouth didn’t have a particularly strong showing in the election — he finished fourth with just 2.7% of the vote — as leader of APRD he has control over a significant rebel force in the northwestern region of the country.

Vircoulon says a worse case scenario for the country would see Démafouth, along with the other opposition leaders lead factions of the country back into an “active rebellion.”

He describes the situation in the country over the past year and a half as being in a state of “passive rebellion”. Passive because while tensions between rebels and the central government persisted, they were for the most part, quelled by diplomatic moves on Bozize’s part.

To ensure that the country doesn’t slip back into a state of active rebellion, Bozize will have to continue to make such overtures to the opposition. One key move analysts expect is to make Démafouth an offer to take an important role in his government. If he accepts, and Patassé and the other key opposition leader Martin Ziguélé, come to recognize the government, the table for greater stability would be set.

As for media reports that the Lord’s Resistance Army continues to be a serious threat in the country, Crisis Group’s Vircoulon says such a threat has been largely overstated.

“The LRA did not disturb the election,” he points out. “They are really just another medium groups doing bad things far away in the bush.”

The group is active in the far eastern portion of the country where CAR borders the Democratic Republic of the Congo to the south and Sudan to the north.

The election results have yet to have any significant impact on Toronto-based Axmin’s (AXM -V) share price.

The company is currently looking to finance the construction of its 205,000 gold oz. per year Passendro gold mine which sits in the south central part of the country, 60 km north of the town of Bamberi. The region is considered to be safely under government control.

In August of last year Axmin announced it had come to terms with the government for a 25 year mining licence. A part of the deal Bozize’s government secured a signing bonus of $11 million and 26 million shares in Axmin along with 20 million warrants with a strike price of 30¢.

The deal also saw Axmin secure a five year tax holiday after which it will pay the standard corporate tax rate of 30%.

In Toronto on Feb. 4 Axmin shares were off 5% or 1¢ to 17¢on 1.7 million shares traded.