Malawi Extractive Industry Transparency Initiative (Mweiti) Report revenue figures show that the country’s mining sector contribution to gross domestic product (GDP) has stagnated over the years.
In the report, which covers 2021/22 and 2022/23 fiscal years, Malawi raked in K47.75 billion in 2021/22 and then K53.83 the following year, which is equivalent to 0.76 percent of GDP.
Reads the report in part: “Total revenues received from the extractive sector in the financial year 2022/2023 amounted to K53. 8 billion.
“The Malawi Revenue Authority accounted for 77.55 percent of the total revenue streams generated by the sector while the Ministry of Transport and Public Works and the Department of Forestry accounted for 12.59 percent and 7.94 percent, respectively, of the total extractive industry revenues.”
The mining sector contributed 79 percent while transport, forestry as well as oil and gas contributed 13 percent, eight and zero percent, in that order of total extractive industry revenues.
The companies that contributed hugely include Shayona Cement at K11.58 billion, Lafarge Cement Company at K8.8 billion, Raiply Malawi Limited at K4.5 billion, Cement Products Limited at K4.4 billion and Optichem 2000 (MM) Limited at K2.7 billion.
From the 2015/16 to the 2022/23 report, an analysis shows that the country has raked K203.8 billion.
But the latest report indicates that in fiscal year 2023/24 and 2024/25, the Malawi Government collected K1.013 billion and K1.063 billion respectively, in revenues partly due to upward adjustment of the fees.
Meanwhile, KCM Consulting Limited director John Kazembe, whose institution produced the report, has said to harness the full potential of the sector, few things should be done.
He said: “The sector contributes only one percent to national income. To harness full potential of the sector, there is need for more policy reforms to improve legal and regulation framework; administrative procedures, building capacity to enhance oversight and local participation.
“The other support structures necessary to facilitate investment also need to be in place.”
In an interview on Wednesday, Minister of Mining Ken Zikhale Ng’oma said they expect changes by December this year when Kayelekera Uranium Mine in Karonga starts production in the third quater of this year.
“Such production will be a paradigm shift for Malawi’s economy,” he said.
Mining is one of the four major priority sectors alongside agriculture and tourism and manufacturing collectively called ATMM to stimulate economic growth and achieve the Malawi 2063, the country’s long-term development plan.
Extractive Industry Transparency Initiative was first announced at the World Summit for Sustainable Development in Johannesburg, South Africa in 2002 and officially launched at Lancaster House Conference in London in 2003.
