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TI dares Malawi on mining deals

Transparency International (TI) has challenged Malawi civil society organisations (CSOs) and the media to ensure independent and strict scrutiny of revenues that Malawi government is earning from natural resources, particularly from the extractive industry.

Professor Peter Eigen, who is founder and chairperson of advisory council for TI, a global coalition against corruption, said this in Berlin, Germany on Tuesday when he addressed business journalists from Asia and Africa on TI’s Extractive Industries Transparency Initiative (EITI).

Despite Malawi witnessing a boom in its mining and exploration activities in recent years, the country is not yet party to the EITI candidature which is a global standard that promotes revenue transparency from extractive sector by improving transparency and accountability in the sector.

“It is up to the civil society and the media in Malawi to mobilise themselves and oversee mining activities effectively because oftentimes governments have a simplistic approach to handling extractive companies,” said Eigen.

Eigen, a former World Bank manager of programmes in Africa and Latin America, was responding to a question from Business News on how best Malawi can avoid being a resource curse, a paradox where countries with abundant non-renewable resources such as minerals and fuel, tend to have less economic growth and worse development outcomes than countries with fewer natural resources.

He gave an example of Democratic Republic of Congo (DRC) as one best example of countries endowed with natural precious minerals, but ironically, ranks poorly in terms of nominal Gross Domestic Product (GDP) as well as national per-capita income.
He added: “The media and civil society must not leave everything in the hands of government .They must make sure that mining companies and government must not violate their agreements and this can in the end ensure that anyone in the country has a fair share of your natural resources.”

Eigen also stressed that government revenues from natural resources across the globe have often been badly managed, “veiled in secrecy and fraught with corruption.”

He said currently, a coalition of 50 countries, civil society organisations and 60 of the largest oil, gas and mining companies is working with EITI to fight corruption in extractive sectors.

He also challenged Malawi to emulate Africa’s populous country, Nigeria, which he said has managed to establish a national working group comprising representatives from government, civil society and oil companies to oversee activities in the oil sector.

Eigen also indicated that increased transparency in the mining sector in Malawi could lead to a drastic reduction in corruption, stimulate foreign direct investment (FDI) and bolster financial independence in the long run.

Currently, 35 countries across the world are implementing the EITI which according to Eigen has enabled citizens in the countries to easily find out how much their governments receive from their natural resources and hold them to account.

Globally, 3.5 billion people live in countries rich in oil, gas and minerals and according to TI. With good governance , the exploitation of these natural resources can generate large revenues to foster economic growth and reduce poverty.

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