Lost treasure? Malawi losing out on precious minerals over illegal mining

In parliament, in May last year, Welani Chilenga who leads the committee on natural resources told the house that the country is losing unprecedented millions on daily basis through illegal mining in the lakeshore district of Mangochi and Mzimba in the northern region and other places.

The remarks followed a direct response to President Lazarus Chakwera whose State of the Nation Address said Malawi is looking into other economic options to replace tobacco as the major forex earner and that sights have also been put on mining.

Chakwera said in parliament that Malawi wants mining adventures.

In Mangochi, through its trail of investigation MIJ has established that people from neighboring Zambia and Mozambique are both leading illicit deals in mining, that are not taxed or regulated by the government.

The country has several minerals, such as Phosphates bauxite, kaolinitic, coal, kyanite, limestone, rare piles of earth graphite, sulphides (pyrite and pyrrhotite), titanium and vermiculite.

In an interview, one of the traders whom we shall only refer to as Thom* says it is evident that more minerals are being taken out of Malawi.

โ€˜โ€™It becoming a big business and everyone knows that there is no regulation at all. You just need to trade carefully at the markets. As a Malawian, I am just getting worried because the resources are ours,โ€™โ€™ he says.

MIJ Online learns that some foreign nationals have even been able to hire locals into working either as agents or drillers of the minerals from the precious hills of Namizimu in Mangochi, Malingunde in the capital Lilongwe, Vuwa in Nkhotakota and Perekezi in Mzimba district, places that Chilenga even outrightly names in parliament.

Minerals going out of Malawi without trace.

The highly sought commodity has been gold which other media reports also said were being dug in Mwanza district which neighbors Mozambique. A gram of gold has been illicitly sold for aroundย  MK 25,000 according to what we learn.

However, as Thom* details, more and more illegal traders are going on untraced by authorities.

โ€˜โ€™You must understand that in the villages where we live, we see vehicles around some even carrying sand, but we are aware of the trade they undertake in. In the past, someone dared to report to the police, but nothing tangibly has been done and communities are now joining the trade. It appears easy,โ€™โ€™ he says.

But two years ago, local authorities in the northern region district of Mzimba managed to force Chinese mining companies to stop operations in areas under their jurisdiction following allegations that they were operating illegally through physically set markets.

At the heart of the concern of lack of action by law enforcers lies the matter in which the government has not yet established the Mining Regulatory Authority.

Back in parliament, Member of Parliament for Zomba Central, (a district that nears Machinga, where a trail of illegal mining reports has also been highlighted) Bester Awali called for the suspension of all mining activities until Authority is set up.

His call was in response to Awali’s expressed concern that some mining companies are still operating.

Awali: Raised concerns in parliament.

โ€œHonorable Members, you may wish to note that all minerals that were taken out of the country as samples but were not brought back after failing tests should be considered sold and appropriate royalties be deposited in Government Accounts. We keep losing more money by letting the mining and extractive industry do business as usual,โ€ said Awali.

The piece of legislation in use is the 1981 Mines and Mineral Act which regulates mining in Malawi, but its stipulations are believed to be rather weaker.

In its inquiry, MIJ has learnt that In Mwanza, law enforcers had been probing the activities but arrests were not done prompting communities near hills to be involved in the trade.

โ€˜โ€™ We have only known that there are minerals around here because of the foreigners we see around hereโ€™โ€™ says an anonymous member of the community around Machinga district.

In recent years, the Ministry of Natural Resources, Energy and Mining has been issuing statements making a stern caution to individuals involved in illegal mining to stop or face eviction citing the 1981 law.

But Kossam Munthali who leads an influential organization in the sector- Natural Resources Justice Network in Malawi wondered why the government has been coy on the matter and not been pushing for effective laws to tame the situation.

Chilenga has been critical of the industry.

His view has also been widely shared by Chilenga who has also served as minister of mining during the reign of Peter Mutharika until 2022.

But Albert Mbawula, the current minister of mining insists that government is aware of problems in the mining sector that include alleged corrupt practices as well as the smuggling of minerals by foreign nationals.

Among other things, he says the government is setting out means to push for the regulation of the industry.

His view comes at a time when the government has stated that money over 9.4 Billion Kwacha has gone into the hands of artisanal gold miners.

โ€˜โ€™ By November 2022, the Reserve Bank of Malawi has received 187 kilograms of gold through the structured market we are building. At the moment, we are also due to open the gemstone market which will facilitate a competitive market,โ€™โ€™ he says.

Mbawala insists the Malawi government will sanitize the industry.

So far, Mbawala has also revealed that the Malawi government has ignited engagements with international consultants to assess investment options for Malawi.

However, as Awali argued in parliament, Malawi first needs to have laws and institutions to manage the sector, a plan Mbawala says remains in the pipeline although a section of Malawians online feel government continues to play lip service casting expectations on deliberation for the next sitting of parliament.

At the loss of MK 5 Million per day, Malawi appears to lose not just its resources, but also a fortune that can transform the economy of the Southern African nation which still banks on tobacco as a major forex earner.

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