A local civil society organisation that advocates transparency in the mining sector has hailed Malawi’s intention to subscribe to the Extractive Industries Transparency Initiative (EITI) as announced by President Peter Mutharika on Tuesday this week.
Malawi’s subscription, according to Citizen for Justice, will greatly help in profiling the amount of natural resources the country is endowed with and the revenue it is accruing from such resources.
“The subscription to EITI is the best for Malawi as it will help government profile how much resources we have and money we receive from mining companies as a country,” said Citizen for Justice executive director Reinford Mwangonde.
EITI is an international standard that ensures transparency around countries’ oil, gas and mineral resources.
Mwangonde was reacting to Mutharika’s announcement in his State of the Nation Address that his government will establish an independent contract negotiating unit in extractive resources and that Malawi will subscribe to the EITI.
The President was commenting on what his government intends to do to promote mining sector in the country which is tipped to contribute about 20 percent of Gross Domestic Product (GDP) by 2016.
Currently, the sector is contributing an average of 10 percent of GDP from a meagre contribution of five percent in 2009.
“By subscribing to the EITI, communities will also be able to understand how much money goes into government coffers. It is a good move but surely we have to go beyond that [subscribing to EITI],” added Mwangonde.
He described Mutharika’s promises on mining as ‘good indications’ but urged the government to ensure doing more actions than just dreams.
Mutharika noted in his address that Malawi is richly endowed with high value mineral resources which constitute an important source of wealth for development and foreign exchange for Malawi.
He said his government will, therefore, prioritise the effective exploration of such resources.
Mutharika said government is committed to promoting the mining sector in the country, saying he will endeavour to provide an enabling environment for attracting investments into the sector through the development of new policy, legal and institutional frameworks that protect the long term interests of the country.
“Mr. Speaker, Sir, currently, there are a number of foreign companies that are actively engaged in the exploration and evaluation of various minerals in different parts of the country, including rare earth metals, uranium, gold and titanium bearing heavy mineral sands,” he noted.