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Promotion of mining investment should go beyond holding an investment forum

May 09, 2024 / Marcel Chimwala

As reported in our article on Page 6, Malawi will hold its first ever mining investment forum this year with the Malawi Government planning to make the forum an annual event.

We commend the Government for organizing this forum, which as Minister of Mining Monica Chang’anamuno is quoted in the article, is expected to attract over 300 delegates including global mining investors.

We agree with the Minister that the forum is important because the mining sector is central to the country’s industrialization agenda as outlined in Malawi 2063.

Since exploration by different companies continues to prove that Malawi has sizeable quantities of essential mineral resources such as rare earth elements, graphite, uranium and niobium; there is need for the country to attract investors along the value chain to ensure local value addition of these minerals.

As Chang’anamuno is quoted in the article, Malawi also needs investors to provide different services to the mining industry including tourism and hospitality.

However, we believe that Government should go further than attracting foreign direct investment to empower Malawians to invest in mining and its value chain.

We should not only expect foreign investors to come to Malawi and invest in processing of minerals. Government needs to court financial institutions to support locals investing in mineral beneficiation projects.

It is disappointing that despite Government treating mining as a priority in its development agenda, many local financial institutions are not ready to finance mining projects because they treat the sector as risky.

It is imperative for the Department of Mines to court the financial institutions to start financing mining projects.

Government also needs to create a conducive environment for mining investors by ensuring that bureaucracy is rooted out of its systems.

It should not be taking ages for investors to acquire licences or get mining development agreements signed as this disappoints the concerned investors and has the potential to scare off other investors.

Malawi should also study the current best practices on taxation in other mining countries and come up with a competitive taxation rate.

It reflects badly on the country to hear that Paladin Energy, the previous investor in Kayelekera Uranium Mine in Karonga which closed due to low uranium prices, has resumed uranium mining at Langer Heinrich Uranium Mine in Namibia which was closed for the same reasons.

Malawi needs to study the taxation regime in countries like Namibia and apply a similar model to ensure that Kayelekera resumes production.

Investors cannot just be attracted by holding a forum, the best way to attract investor is to treat fairly the existing investors. 

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