Mining commitments, macroeconomic regime shifts and commodity-cycle exposure: Evidence from Simandou in Guinea

Large extractive megaprojects are usually studied through realized exports, fiscal revenues, and Dutch disease once production begins. This paper instead asks whether such projects generate measurable macroeconomic regime shifts during the commitment phase, before extraction starts. We examine the Simandou iron ore project in Guinea, a USD 20+ billion investment whose first commercial shipments began just after the close of our 1990–2024 sample. Using Guinea's macro-sectoral data and a 23-country panel of low-income commodity exporters, we combine structural-break tests, post-break regressions, growth decompositions, regime-dependent local projections, and — as supplementary corroboration — a synthetic-control counterfactual. Bai–Perron tests identify a significant break around 2017, coinciding with major Simandou-linked infrastructure commitments. Post-break regressions show a persistent shift in growth dynamics and sectoral composition, though industry's average contribution is essentially unchanged and the agriculture-share rise is partly measurement-driven. Local projections indicate that aggregate output exhibits a statistically significant medium-horizon contractionary response to positive mining-price shocks in the commitment regime (θ 3 = −4.03, p = 0.017). Sector-level shock-sensitivity coefficients show larger point estimates for industry post-commitment but the pre-post difference is not itself statistically significant. The synthetic-control counterfactual shows visible post-2017 divergence but with weak statistical support (Guinea ranks 6 of 20 in placebo tests; p ≈ 0.26), and we treat it as background corroboration only. Anticipated mining megaprojects can reshape growth dynamics and commodity-cycle exposure well before production begins, though causal attribution to any single driver is limited by the short post-break window. The paper draws forward-looking implications for sovereign wealth fund design and the Simandou 2040 strategy.