Government plans to establish the Malawi Mining Authority to regulate activities in the mining industry as well as to champion sectoral investments.
Minister of Finance Joseph Mwanamvekha revealed the development on Monday during the presentation of the 2019/2020 National Budget in Parliament.
According to the minister, mining is among government’s key priority areas, hence, the authority will help in regulation and investment issues.
Said Mwanamvekha: “Government recognises mining as a sector with growth potential. To facilitate and coordinate economic activities in the mining sector, government will establish the Malawi Mining authority as a regulator in the mining sector. We will, therefore, be consulting this August House as we embark on this process.”
Ministry of Natural Resources Energy and Mining spokesperson SangwaniPhiri said the authority will ensure that mistakes like those made in the deal between government and Paladin Africa Limited on the Kayerekera Uranium Mine in Karonga are not repeated.
Phiri explained that the authority will help organise small and medium artisanal miners to ensure their operations are regulated to bring economic benefits to the country.
Centre for Environmental Policy and Advocacy (Cepa) executive director William Chadza welcomed the establishment of the authority, but stated that there are issues that needs to be clarified.
He said: “There is need to carefully select the composition of the authority so that it can achieve independence by way of looking at what the companies are doing and the role of government and other stakeholders. The other issue is on how it is going to be financed to deliver its expected responsibility.
“We do not understand how the Authority relates to the new Mines and Minerals Act of 2018 because it provided for the establishment of the mineral resources committee so we don’t know whether the authority will be anchored in the new Act or not. It will be important to clear out the institutional mandate in terms of the Mineral Resources Committee, the Authority and the Office of Commissioner of Mines and Minerals under the new Act”.
Natural Resources Justice Network (NRJN) chairperson KossamMunthali said the mining sector really needs a regulator and the network has been advocating for one.
He said government has over the years been regulating itself in the mining sector, hence accountability has been a challenge.
Figures compiled by the National Statistical Office (NSO) and Department of Economic Planning and Development show that the mining sector grew by 1.1 percent, 0.4 percent, 1.6 percent and 2.3 percent in 2015, 2016, 2017 and 2018, respectively. Meanwhile, in the 2019/20 budget, government has allocated K40 billion to the energy and mining sectors, which is almost twice the amount allocated to the sector last financial year at K21.7 billion.
Treasury believes the allocation will contribute to the growth of the sector whose performance has of late gone down due to the suspension of the Kayerekera Uranium Mine which is on care and maintenance waiting for global uranium prices to pick up.