Long wait for National Mining Company roll-out

Malawi will wait a little longer to see the establishment of the National Mining Company as the Ministry of Mining is yet to secure K5 billion seed capital for the roll out.

Ministry of Mining spokesperson Andrew Mkonda said in a written response to a questionnaire on Friday the ministry is currently banking on the Ministry of Finance and Economic Affairs to consider an allocation of the seed capital in the forthcoming budget review.

He said: “We submitted a funding request to the Ministry of Finance and Economic Affairs for a consideration during the 2022/23 Mid-Year Budget Review and we are now  just waiting for that time.

“We, however, continue spearheading the establishment and operationalisation of a State-owned mining investment company whose mandate shall be promotion of the optimal development of the mineral sector and maximisation of the national mineral revenue and social benefits.”

However, Minister of Finance and Economic Affairs Sosten Gwengwe could not guarantee earmarking any allocation to the establishment of the company.

In a brief response on Friday, he said while the ministry has been engaging the Ministry of Mining on the establishment of the firm, an allocation of funds has not been considered yet.

Said Gwengwe: “We are considering all requests from all ministries, departments and agencies. Kindly note that the mid-term budget review framework is not drafted yet.”

But Mkonda indicated that the Ministry of Mining is ready and will continue working on the project.

He said saying the firm will promote the mining industry, contribute towards the industry’s socio-economic development and create job opportunities.

“We are optimistic to get a positive response from the ministry of Finance and Economic Affairs but should things not go well, we will look into other alternatives to raise the funds,” he said.

President Lazarus Chakwera announced last year that government plans to establish a National Mining Company to facilitate development of the sector, which is among government’s priority sectors for economic growth.

He said government wants to move away from tobacco farming as a major forex earner and mining is regarded as one of the potential industries that can replace tobacco.

Meanwhile, growth in the mining sector has lately been on the decline, falling from 7.4 percent in 2019 to 3.1 percent in 2020, according to the 2022 Malawi Government Annual Economic Report.

This year, the sector’s growth is projected to reach 4.6 percent with the expectation that demand for quarry aggregate will increase.

For 2023, growth for the sector is projected at five percent with the expectation that mining and mineral exploration will continue to grow as more miners obtain exploration licences.