President Joyce Banda on Tuesday launched a mining project that will facilitate the development of infrastructure for generation and distribution of reliable geological information.
The Mining Governance and Growth Support Project also aims at developing a policy instrument that will promote good governance and growth of the mining sector.
The project will also review the legal and regulatory framework to support the development of the policy Act for the promotion of artisanal and small scale miners.
Speaking during the launch in Lilongwe, President Banda said over the years, Malawi had heavily relied on agriculture as a source of its revenue, citing tobacco as the only crop that generated most of the country’s income.
Banda said any bad crop season or poor world crop prices exposed the country to foreign exchange -related crisis.
She described the mining governance and growth support project as vital for boosting the mining sector which she said forms one of the five priority areas of the economic recovery plan.
“Before 2009, contribution of mining to the Growth Domestic Products (GDP) was only three per cent and rose by 10 per cent in 2010. It is expected that the contribution of the mining sector would improve by 20 percent by the year 2016.
“The launch of this project therefore gives us hope that we will be able to diversify our revenue generation by, among other things, paying more attention to the mining sector,” Banda said.
She said the project would develop standard documents and procedures for issuing licenses and negotiating agreements, create value addition and standards in line with the national export strategy and also build capacity and provide support to small scale miners, especially women.
Banda assured investors that her government would always strive to create a conducive environment and protect their lives and property.
European Union (EU) Ambassador to Malawi, Alexander Baum, hailed President Banda for recognizing the mining sector as another potential area that would improve the economy of the country.
Baum described mining as an integral area that had helped many countries to develop. He cited Norway in Europe and Zambia in Africa as some of the countries whose economy had grown fast as a result of mining activities.
“Malawi has a lot of mineral deposits and if the country could properly invest in this sector, be assured of a boom economy,” Baum said.
Meanwhile, the World Bank, EU and the French Government have pumped into the project US$25Million, 4.1Million Euros and 11 Million Euro respectively.
Sandra Bloemekamp, World Bank Country Manager, appealed to the Malawi Government to put in place policies that would attract investors.
Bloemekamp said looking at the great potential that the mining industry had on the economy of the country, the bank decided to participate and fund the project.
Malawi’s economy has in the past years relied on rain-fed agriculture which is prone to natural shocks, including drought and floods.
It was against this background government changed its policy by diversifying its economy, and identified mining as one area which it believes can lead to high economic growth and development.
The Mining Governance and Growth Support Project will, among other things, improve the efficiency, transparency and sustainability of the mining sector management.Follow and Subscribe Nyasa TV :