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Eiti demands mining accountability

The Extractive Industries Transparency Initiative (Eiti) Board has urged Malawi to ensure that published extractives information is complete and reliable to further build trust and accountability.

Specifically, the Eiti Board wants Malawi to ensure that transparency in revenue flows in its developing petroleum sector as well as companies’ social expenditures is commensurate with the clarity achieved in mining.

Exploration of graphite at Malingunde: The extractive industry is growing

But still, Malawi has passed the first validation test on Eiti, as the board has agreed that the country has made meaningful progress in implementing the Eiti Standard.

The 42nd Board meeting in Kyiv, Ukraine, recognises that consistent follow-up on recommendations from Eitireporting, together with Ministry of Finance’s hosting of Malawi Eiti (Mweiti), have helped drive concrete reforms.

It observes that advances in fiscal and contract transparency, as well as the launch of an online licence cadastre and publication of extractives contracts, have helped create the basis for governing the sector in an inclusive and equitable manner.

It reads: “Despite the modest size of its extractive industries, Malawi has successfully established a platform for multi-stakeholder dialogue on extractives governance to drive improvements in transparency and accountability.”

Moving forward, it has urged Capital Hill to continue work on systematic disclosures of Eiti data and efforts to ensure beneficial ownership transparency as a means of strengthening effective government oversight of the extractive industries.

It said improvements could help support the translation of transparency into greater accountability in the management of the extractive industries and help support their development into a key driver of economic growth over the medium term.

“The board has determined that Malawi will have 18 months, i.e. until 27 August 2020 to carry out corrective actions regarding requirements relating to industry engagement, work plan, licence register, data comprehensiveness and quality, distribution of revenues, mandatory social expenditures and outcomes and impact of implementation.

“Failure to achieve meaningful progress with considerable improvements across several individual requirements in the second Validation will result in suspension in accordance with the Eiti standard,” it states.

Mweiti coordinator George Harawa said they were pleased with the Eiti board’s decision, stressing, it shows improvements that Malawi has made.

He said the multi stakeholder group (MSG) will have to meet shortly where it will go through the decision and the recommendations and strategy to ensure that Malawi is not suspended in 2020.

He said some of the recommendations are part of what the Second Mweiti Report made and a remedial action plan (RAP) was developed by the secretariat and was approved by the MSG.

“One of the most important things to achieve this, Malawi will need to produce the third Eiti report whose preparation has already began. The challenge that we foresee is financial support as Mweiti is currently facing financial challenges to implement most of its activities.

“So, we need to source financial resources, the Malawi Eiti secretariat need to have adequate personnel and the good political support that we have has to continue,” he said.

Meanwhile, chairperson of the Natural Resources Justice Network (NRJN) Kossam Munthali has said government must work towards building the capacity of its staff for them to be able to monitor volumes of production rather than relying on the data collection forms by the companies.

The issue of revenue collection and prudent management is not only in the Petroleum sector. In other solid minerals, a clear and effective, transparent and accountable system needs to be put in place. n

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