Editorial with Marcel Chimwala: Malawi government must cautiously handle mining licence issues

EDITORIAL

Government must cautiously handle mining license issues

Managing Director of Ilomba Granite, Faisal Hassen, went to town communicating to our readers through our mailing list that he got the granite mining license in Chitipa through family lineage. Hassen who seemed happy to play a role of an ombudsman of the press by attempting to discredit this publication, corrected us before our readers that his license was awarded in 1988 during the reign of Dr. Kamuzu Banda and not in 1995 by the Bakili Muluzi administration as shown in the cadastre and as reported in our September edition.

This shows that Mr. Hassen and his family have held on to the  license for over 29 years and not just over 20 years as we reported in the September edition. We feel this is not just very long but too long a period for an investor to develop the deposit for the benefit of the country including the poor people of Chitipa.

We feel if he is real an investor worth the salt and not just a middleman, Mr. Hassen must be brave enough to prove to the nation that he has developed a mine at Ilomba and has been paying royalties and taxes in the 25 years plus years he has owned the license.

He should also give the nation records of corporate social responsibility projects Ilomba Granite has undertaken in these too many years. Of course, in front of our readers, Mr. Hassen said he can only show these records to the Department of Mines officials. We feel this is a lame excuse in these days when transparency is deemed as key to developing the minerals sector.

We also want to remind Mr. Hassen that though he acquired the license through family lineage as he says, the current Mines and Minerals Act under review says mineral resources are owned by the state on behalf of the people of Malawi. Therefore, we just as all people of Malawi have the right to access the sales and tax records for Ilomba mine. Otherwise, we will still harbor the assertion that Mr. Hassen is a middleman who is holding on to the mining license with a purpose of finding a good buyer.

Now there is this issue of the government rejecting renewal of a mining license for Nyala Mines, a company that has been mining rubies and sapphires at Chimwadzulu Mine in Ntcheu.

The Ministry of Natural Resources, Energy and Mining says key among the reasons it is rejecting the renewal of the license is that the investor delayed to submit a letter indicating his interest in extending the 10-year license period as the law says the application must be received by the Ministry a year before expiry of the license.

We feel both parties are at fault here because a serious investor keeps records and would not forget to submit the application for renewal of a license in time. On the part of the government; it holds 10% shareholding in Chimwadzulu Mine and surely its board member would have been able to talk to Nyala if there were any outstanding issues that needed to be settled by the two parties.

All in all, we ask the government to put dialogue as a priority in handling licence issues to avoid unnecessary conflicts with investors.

Blunders were indeed made in the way some mining licenses were awarded in the past but if the government uses shortcuts in handling the issues, it will create more mess in the industry in the form of court injunctions which will certainly leave many potential deposits undeveloped.

***

This piece was initially published in Malawi’s Mining & Trade Review Issue Number 55 (November 2017).

The full edition is available for download here. This monthly publication is edited by Marcel Chimwala.

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