Feasibility studies key in mining sector—Mitc
Malawi Investment and Trade Centre (Mitc) says feasibility studies provide investors with the right information on the worth of mining projects before they take off.
Mitc chief executive officer Paul Kwengwere said this yesterday on the back of views from the World Bank contained in the latest issue of Malawi Economic Monitor.
The bank’s report stated that despite being earmarked as one of the key drivers of economic activity alongside tourism and agriculture, the mining sector was still operating below capacity and contributing below its potential to the country’s gross domestic product (GDP).
Kwengwere said it is helpful to an investor to know the volumes that can be extracted, the possible investment that would be required and the return on the investment on the project.
“If we do this [feasibility study], then the investors will be more confident when coming in,” he said.
Kwengwere said adding value to mining exports could improve Malawi’s profit margins from its precious stones and gemstones.
He said for instance, during a trade exposition in Qatar last year, a gemstone necklace was selling at $90 000 (about K153 million).
“But the raw material for this product would cost about K15 000 locally.,” said Kwengwere.
In her presentation during a business breakfast hosted by NBS Bank plc in Lilongwe on Thursday, Economics Association of Malawi acting president Bertha Bangara-Chikadza said the government should mobilise resources for the exploration and development of mining projects.
“Malawi should invest in a processing centre that can buy/aggregate precious metals from small-scale miners,” she said.
Export Development Fund spokesperson Deliby Chimbalu, whose organisation has been buying gemstones from artisanal miners on behalf of the Reserve Bank of Malawi, said adding value through processing would be “a welcome development”.
The Malawi Government Annual Economic Report 2024 says despite its enormous potential, the mining sector currently contributes only one percent to the GDP
