The signing of two mining development agreements in July revealed a disjointed nature of work by government ministries, departments and agencies that stalled the process of mining investments for two years, it has emerged.
Presidential Delivery Unit (PDU) head Janet Banda, who is also Deputy Secretary to the President and Cabinet, said this on Tuesday in Lilongwe at the start of the Malawi 2063 First 10-Year Implementation Plan (MIP-1) Pillar and Enabler Coordination Groups (PECGS) meetings.
She said it had to take a presidential directive to have PDU intervene to make things work.
The two mining firms, Lotus Resources Limited and Lancaster Exploration Limited, had applied for the MDAs, which have potential to generate combined export proceeds worth about $500 million (about K875 billion) annually at the peak of production.
Banda said some government officials involved in the process could not work together to conclude the discussions on the agreement, leaving the two companies stranded.
She said after the President intervened, it only took eight days to have the same process completed up to the point of signing the agreements with the mining firms.
Said Banda: “What we learnt from the mining sector is that collaboration is the best strategy that we can use to achieve results.
“We could see that even to conclude the agreements, we had to work with all stakeholders, including the mining investors themselves.”
She said the same approach is being used in other sectors, including tourism as another key sector that needs strategic projects and reforms.
Several mining firms have been complaining of protracted processes of getting mining licences, a process that involves various government agencies.
It also took about 10 years to enable Globe Metals and Mining to secure mining development agreement for the development of Kanyika Niobium Mine in Mzimba District.
National Planning Commission director general Thomas Chataghalala Munthali lamented rampant corruption within the government system as a key deterrent to investment in the country.
He said some investors even approached the planning commission to express frustrations over their experience in processing investments, claiming that some individuals demanded bribes.
Munthali said this is affecting catalytic interventions in the implementation of MIP-1, which is key to ensure that Malawi turns into a lower middle income economy by 2030.
However, Minister of Mining Monica Chang’anamuno earlier said that before signing mining development agreements, government was being careful in the negotiations to ensure a fair deal and avoid previous mistakes.
During the inaugural mining investment forum in Lilongwe earlier this year, she acknowledged that one of the key lessons learnt was to have mineral specific incentives as different minerals and projects need different types of incentives to attract investors.
Mining is one of the key sectors for the government to catalyse economic growth as part of the ATM strategy or agriculture, tourism and mining.
