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Malawi’s extractive industries in the face of Covid-19


Mweiti member at Mkango site

LILONGWE-(MaraviPost)-Malawi’s extractive industry has not been spared from Covid-19 spike’s terrific slap that there is slowly progress in the sector.

Extractive industry that includes forestry, oil, gas and minerals still remains untapped economic base Malawi can generate revenues for Domestic Growth Product (DGP) muscles.

With Covid-19 pandemic, extractive sector is also struggling like any other economic sector worldwide including Malawi.

The recent media tour in two extractive sites namely Mkango mine and Cement Product Plant in Phalombe and Mangochi districts respectively revealed slow progress of production than anticipated couple with little support to communities surrounding the sites against Covid-19 novel.

Center for Environmental Policy and Advocacy (CEPA), Oxfam Malawi, Southern Africa Resources Water (SARW) in conjunction with Malawi Extractive Industries Transparency Initiative (MWEITI)   organized the tour to appreciate extractive industry amid Covid-19.  

For instance, work has been to halt at Mkango Resources (Songwe hills with Rare Earth mineral, Phalombe district) while finalization of Environmental Impact Assessment (EIA) soon after drilling in 2018.

Mkango was given an exploration licence for possible open cast mining at Songwe hills.

Communities surrounding the extractive sites however expressed displeasure over lack of support from the companies on Covid-19 Protective, Prevention Equipments (PPEs).

Sub Traditional Authority (STA) Maoni of T.A Nazombe

Sub Traditional Authority (STA) Maoni of T.A Nazombe wondered as to why the company was silence on Covid-19 PPEs support.

“The company has been helping us with numerous corporate social responsibility including school block and maintenance of bridges.

“But there is little support from the company on Covid-19 PPEs. We need Covid-19 PPEs as communities are also scared on the disease,” urges Chief Maoni.

Mkango Resources Project officer Stuart Chibanda is optimistic that possible extraction of the Rare Earth mineral will be done.

But with Civid-19, Chabanda disclosed that there is no much work at the site as anticipated.

He however acknowledged communities concern assuring them of total commitment on Corporate Social Responsibility (CSR).

“There is little indeed done much to communities on Covid-19 but our workers are fully safeguarded with PPEs. Honestly, we expected them to come to us with their needs for our support.

“But Mkango bought a state of the art machine worthy MK10million which was donated to Queen Elizabeth Hospital in Blantyre to help Covid-19 patient. So, even if this was not directly given to community around us, it was given to a hospital where communities would be refereed to in case of a problem”, says Chibanda.

He however added, “Despite that company is also offering scholarships to 24 students. We pay for their secondary school fees. We take in six students per year. There 3 primary schools surrounding us Changa, Mphembezu and  Mangazi so we get 2 top primary school leavers from each school (1 boy and 1 girl) and pay their school fees from Form 1 to 4.

“Since we started with two of our students have been selected to University and we will continue to support them with their university tuition fees. We also have school feeding programme. It feeds close to 2,000 primary school students at Mphembezu primary school and Changa primary school”.

While his counterpart, Aslam Gaffar, Cement Plant’s Managing Director said Covid-19 has not affected much of its production.

He said there is huge demand for cement that the industry remains untapped and unutilized.

Gaffar disclosed that only shipping of chemicals for cement production has been slowed due to flight cancellation.

He however said the company has done much on Covid-19 PPEs support to surrounding communities including Mangochi district hospital.

CEPA Programs Manager Gloria Majiga Kamoto lauded communities’ ability in quarreling policy holders and mining authorities on extractive activities.

Kamato observed that communities are able to follow up on any mining activities on their disposal than before.

She therefore urged companies in the extractive industry to comply with the new mines law that demand them to meet surrounding communities’ needs.

“We are impressed with communities’ ability to demand accountability on mines companies activities which we have been advocating for. We expect companies meeting locals needs in line with the mines laws,” delighted Kamoto.

The Extractive Industries Transparency Initiative (EITI) was first announced at the World Summit for Sustainable Development in Johannesburg in 2002 (the ‘Earth Summit 2002’), and officially launched in London in 2003.

It was founded on the recognition that, while oil, gas and minerals can help to raise living standards across the world, in countries where these resources are not managed appropriately, this may often lead to corruption and conflicts and, for many people, a lower quality of life.

The EITI is a global coalition of government agencies, extractive companies and civil society organisations working together to improve openness and accountable management of revenues from natural resources.

EITI therefore promotes better governance in countries rich in oil, gas and mineral resources and seeks to reduce the risk of diversion or misappropriation of funds generated by the development of a country’s extractive industries.

Its principles are based on the affirmation that public understanding of government revenues and expenditure over time, could help public debate and inform the choice of appropriate and realistic options for sustainable economic growth and reduction of poverty in resource-rich countries.

The 2016 EITI Standard sets out the requirements which countries need to meet in order to be recognised, first as an EITI Candidate and ultimately as an EITI Compliant country.

There are currently 52 implementing countries of which 34 made meaningful to satisfactory progress.

EITI in Malawi-Timeline Malawi joined EITI following the announcement of the decision to subscribe to the initiative by former Malawi President Peter Mutharika in his State of the Nation Address of 17 June 2014.

On the basis of this declaration, the Multi-Stakeholder Group (MSG) and the MWEITI Secretariat were formed in February 2015.

Malawi was admitted as an Extractive Industries Transparency Initiative (EITI) candidate country in October 2015 and the MWEITI process covers three sectors in Malawi: mining, oil and gas, as well as forestry.

Most of the published reports like first and second report were produced based on 2016 EITI standard but there is new version of EITI standard 2019 currently.

Malawi has of now managed to produce three EITI report. Third one covers 2016/2017 period, from 1st July 2016 to 31st June 2017. This report was produced in November 2019.

Currently Malawi is in the process of producing the 4th EITI report which was initially scheduled for 30th June 2020.

But due to Covid-19 pandemic the process was delayed and secretariat requested for an extension for the deadline.

The EITI International Board made a decision where they approved MWEITI request to produce the report by December 2020.

Further the Board has introduced what is called EITI Flexible  report where MSG can decide and make a flexible EITI report which avoid strict requirements like requirement 4.9b in the EITI standard.

On validation assessment. The second one was expected to be done in August 2020 but due to Covid-19 and EITI Board decision, the validation assessment for Malawi has been postponed to January 2021.

The 4th EITI report will cover period from 1st July 2017 to 31st June 2018 and is expected to be ready before December 2020.

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