By Wahard Betha and Bester Kayaye
Stakeholders in the extractive sector have welcomed the newly appointed Minister of Mining Monica Chang’anamuno calling on her to consider fast-tracking the signing of Mine Development Agreements (MDAs), which government is negotiating with mining companies, in order for the country to substantially benefit from the sector.
State President Lazarus Chakwera appointed Lilongwe North legislator Chang’anamuno as Minister of Mining in a cabinet reshuffle effected on January 31, 2023.
In an interview with Mining and Trade Review, Coordinator for Chamber of Mines and Energy Grain Malunga urged the new Minister to expedite the process to sign the MDAs that the government is negotiating with ASX-listed Lotus Resources to resume mining at Kayelekera Uranium Mine in Karonga, Globe Metals and Mining to start mining niobium at Kanyika in Mzimba and UK firm Mkango Resources for the mining of rare earth elements at Songwe Hill in Phalombe.
“As Chamber, we welcome the new Minister and hope that she will move fast in concluding the MDAs that are being tossed here and there as if we have the luxury to do so,” Malunga said
Veteran geologist James Chatupa also welcomed the new minister and urged for positive political will in the sector.
He said: “I welcome her as our Minister. Her productivity relies on the technical people in the Ministry to place before her a robust agenda of tasks to get accomplished.”
“The Honorable Minister’s initial task should be to get the MDAs signed before July. We must then fully engage Sovereign Metals on its graphite and rutile projects in Lilongwe; and increase our engagements with Mkango and Globe Metals.”
“The technical staff have options of engaging us on the outside to officially assist them. We are available to assist.”
“The tendency these days by civil servants is to cut down their own workloads and make the Minister pursue trivial political tasks hence three ministers in two years which is not health for the sector.”
Programs coordinator for Natural Resources Justice Network (NRJN) Joy Chabwera also bemoaned the changing of Ministers within a short period saying it is frustrating some processes conducted by the Ministry.
Chabwera said: “We welcome her but it is unfortunate that within a short period of two years since this administration came into power we have had three Ministers already.”
“This raises a lot of concern because this is the Ministry which is projected to bring in economic growth.”
Chabwera urged the new Minister to consider engaging Civil Society Organizations (CSOs) in the extractive sector in order to bring change to the sector.
“My advice to the Minister is the same advice we give each time a new Minister is appointed. She should engage stakeholders; she should engage CSOs.”
Meanwhile, government has announced a number of measures it has put in place to develop Malawi’s minerals sector, which caters for a staggering 1% of the country’s gross domestic product (GDP), to substantially contribute to the country’s troubled economy.
Chakwera announced in his State of the Nation Address delivered in parliament that among the measures is the construction of a state-of-the-art mineral processing laboratory complex in Area 4 Lilongwe, which will also house offices for Department of Mines, which is now at 95% towards its completion.
He also mentioned the establishment of the Mining Regulatory Authority and the capitalization and operationalization of the National Mining Company under the Ministry of Mining.
“My administration is also finalizing the formalization of the Artisanal and Small-scale Mining (ASM) sector in recognition of the role small scale miners play in extracting various minerals,” he said.
Chakwera also said his government is reviewing poorly negotiated mining agreements from the past in order to close all loopholes and conflicts of interest that were designed to deprive Malawi of its mineral riches.
He also touted his government’s continued designation of the Reserve Bank of Malawi as a structured market for gold saying it has resulted in the procurement of 186.96 kilograms of gold bought at a total purchase cost of K9.4 billion as of November 2022.
Chakwera said: Madam Speaker, one key area we will strengthen this coming fiscal year is the enforcement of mining laws and regulations. Several laws like the Mines and Minerals Act of 2019 and the Reserve Bank of Malawi Act of 2018 are simply not being complied with.”
“As a case in point, the Reserve Bank of Malawi Act designates the Bank as the sole institution that can purchase, sell or hold gold in Malawi, yet there are people from various nations here procuring gold in Malawi without a licence. These are criminals and my Administration will deal with them according to law.”
However, stakeholders in the mining sector have questioned the significance of the Mining Regulatory Authority saying its roles will be similar to those of the Department of Mines.
Malunga asked government not to prioritize the Mining Regulatory Authority but instead divert full attention to the National Mining Company which he believes will facilitate the mining of strategic minerals to support the country’s industrialization drive contained in Malawi 2063 vision.
Malunga said: “Our priority should be to put into operation the National Mining Company.”
“Things are not moving in the way we want them to. Too much red tape and interference among negotiators in affecting conclusion of mining agreements.”
“Participation into the running of projects in which government has equity is limited and not effective due to the absence of the national mining company which would hold the equity in mining companies on behalf of government.”
He said the Department of Mines should be left to continue handling legal and regulatory issues related with the minerals sector other than establishing an Authority to play the similar role.
Chabwera commented that the Ministry should use funds budgeted to establish the Authority to help the Department of Mines conduct inspections and monitoring works on mining projects.
“It is only a waste of money to create this Authority. Use the money to fund inspectors in the Ministry to do compliance, monitoring and inspections,” he said.
Chatupa also questioned plans to establish the Authority when the Ministry is already struggling to fund some important functions.
“The Mining Regulatory Authority will need another robust input if it is going to be functional. My concern is that it may become another Capital Hill office entity,” said Chatupa.