On Wednesday 10 April, the Ministry of Mining launched the Mines and Minerals Policy (available online from the Extractive Industries Sourcebook after we uploaded the document on Twitter earlier today) that was approved on 25 January of this year. This is the second significant policy framework development this year. In January, the World Bank and Government of Malawi launched the Mining Governance and Growth Support Project.
The Minister of Mining, John Bande, who incidentally scored ahead of his colleagues with 4/10 in a cabinet assessment conducted by the Blantyre Newspaper Limited last week, said on the day before the launch that
Government realises that the economy has a structural problem that results in perpetual shortage of foreign exchange. This originates from the fact that the country heavily relies on agriculture in order to generate foreign exchange while at the same time there is dependence on imports
Bande at the launch indicated that the Government is seeking to increase the contribution of mines and minerals to GDP; contributions rose from 3% to 10% in 2009 and the aim is to see contributions increase to at least 20% by 2016.
He was joined by Charles Kaphwiyo of the Ministry of Mining and Sandra Bloemenkamp, the World Bank Country Manager, who spoke as well as a representative from Globe Metals & Mining company that is set to launch the Kanyika Niobium Project in Mzimba, Malawi.
The Principal Secretary of the Ministry of Mining, Leonard Kalindekafe, explained the process of writing the policy:
The policy was formulated through consultations with all stakeholders ranging from small scale miners, traditional authorities, government departments; verbal and written inputs were welcomed from many individuals and organizations.
Despite this policy development, civil society has been calling on parliamentarians and the Government to swiftly review and pass a new Mines and Minerals Act (1981). The Malawian Institute for Policy Interaction (IPI), headed up by the human rights activist Rafiq Hajat, and the International Alliance on Natural Resources in Africa (IANRA) have made calls for changes to the law that their research suggests deprives the Malawian nation and local communities of benefits from their mineral wealth. They cite environmental degradation, health risks, and lack of company responsibility for remediation of mine sites following decommissioning as some of the costs not accounted for in the current Act. The Director of IANRA, Francis Ng’ambi noted in a media workshop in Blantyre on 6 April that
We want an act that will, besides issues of environment, also increase the current contribution of the minerals sector to the economy, from one percent to a targeted three percent of the Gross Domestic Product (GDP).
The Nation also ran a story recently, written by Ephraim Nyondo, on deficiencies with the Act, which is closely linked to another “outdated” law, the Petroleum [Exploration and Production] Act (1983). Both were created under the life presidency of Dr Hasting Kamuzu Banda,
Another crucial issue through which to understand Dr Banda’s philosophy and the wider political context of the time is that the laws regulating the mining industry were, like many others, highly personalised in favour of the late president.
For example, the Mines and Minerals Act states: “The entire property in, and control over, minerals in land in Malawi are vested in the President on behalf of the people of Malawi; but without prejudice to the exercise of any right under or pursuant to this Act.”
The Policy is an indicator the the Government is beginning to tighten up the sector to ensure more Malawians benefit. However, there are murmurs from civil society that there are a number of deficiencies with the Policy and its success is contingent on swift implementation and monitoring.