Malawi’s mining sector is poised for a boom as the Malawi Chamber of Mines and Energy predicts its contribution to gross domestic product (GDP) to surge to 12 percent by 2027, driven by three major mining projects.
Up until 2014 before Kayelekera Uranium Mine (KUM) in Karonga District was put on care and maintenance, the mining sector’s contribution to GDP was at 10 percent, but since then the contribution has dropped to 0.7 percent as of last year, according to the Malawi Government Annual Economic Report 2024.
Now that KUM has started production with the first yellow cake produced last week, the chamber’s national coordinator Grain Malunga said in the first year, the sector’s contribution to GDP could rise to between four and seven percent.
He said the estimate is in line with significant progress registered at Kayelekera, Kanyika Nioubium Mine in Mzimba and Kangankunde Rare Earth Project in Balaka, which are expected to roll out within two years.
His sentiments come at a time Lotus Resources Limited, a firm which owns 85 percent stake in Kayelekera Mine, has rolled into action while Global Metals and Mining, which owns Kanyika Niobium Mine, expects to roll out in the first quarter of 2026.
Malunga, a geologist and mining consultant, said: “With Lotus already in full action at Kayelekera Mine, Global Metals is expecting first production in early 2026 and Lindian’s Kangankunde Rare Earth Project progressing well, we anticipate the sector to contribute 12 percent to GDP by 2027.
He, however, said while some targets to strengthen regulatory and local capacity are being met, a lot of work is outstanding, including installation of lab equipment at the Mines Department, adding that the online geological database is also not functional.
The projection by Chamber of Mines, a group of companies and individuals operating in the minerals industry, is in line with National Planning Commission (NPC) estimates.
In an interview, NPC communication specialist Thom Khanje confirmed that the chamber’s projection is in line with the commission’s projections.
“This will go a long way in ensuring that Malawi is on track to meet its target of graduating into a lower middle income economy by 2030,” he said.
Khanje said the commission is optimistic that the sector would achieve its target of contributing 15 percent to the GDP by 2030, adding that even a single mine can make a huge contribution to the broader economic measure.
In an update last week, Lotus Resources Limited indicated that it has produced the first yellowcake or powdered uranium concentrated with 90 uranium oxide.
It said samples are expected to be dispatched in the coming weeks.
With the mining sector set to boom between now and the next three years, the Ministry of Finance and Economic Affairs has assured the public that regulatory tools are ready to deal with exploitation.
In an interview last week, Minister of Finance and Economic Affairs Simplex Chithyola Banda acknowledged the extraction sector’s exposure to exploitation such as illicit financial flows and labour laws violations, among others, which could undermine the industry’s economic benefits.
He attributed exploitation in the mining sector to lack of oversight or regulations and expertise which give room for players to bypass the system.
In a separate interview, mining expert Ignatius Kamwanje said although some targets are dragging, there are signs that the sector is on track to achieve a long-term target of 15 percent GDP contribution by 2030.
Mines and Mineral Regulatory Authority director general Samuel Sakhuta said last week that the authority will ensure policies are timely formulated without bureaucracy-induced delays from the ministry.
In its five-year strategic plan, Ministry of Mining outlined ambitious targets such as enhancing capacity for artisanal and small-scale miners boosting technology development.
