Malawi Uranium mining project to boost foreign exchange

Workers at the mining project

Malawi’s government has commissioned the country’s first uranium projectt located in the northern district of Karonga, the ten-year project is expected to boost Malawi’s foreign exchange earnings by 20%.

The approval of the Kayerekera Uranium Project came after critics withdrew their court injunction against it. It’s set to begin in December and will be managed by the Australian mining company Paladin Africa Limited.

Prominent economist Goodall Gondwe, Malawi’s minister of finance said the project is expected to contribute greatly to annual export earnings.

“You [we] are looking at more than 40% addition to our export now. This is huge. It means [if] this project is successful, we will in fact pass the one billion US dollar mark in exports and the impact of that on the economy is enormous,” said Gondwe.

Until now, tobacco has been Malawi’s main export, contributing most of the country’s foreign exchange earnings. The new mine may change that, producing an expected 100 tons of uranium every year.

 But civil society organizations opposed the government’s decision to grant a license to Paladin Africa Limited. They said the company had not addressed possible environmental and health problems.

They said gas released from the mines could cause a number of illnesses, including cancer, kidney infection and brain damage. They also expressed concern over the wastewater from the mines.

But the government said Paladin had met all legal requirements and all the environmental issues had been dealt with. Unconvinced, the NGOs obtained a court injunction to prevent the government from approving the project. The case was settled out of court amid allegations from other civil society groups that their representatives accepted kickbacks to back down. 

Undule Mwakasungura, executive director of the Centre for Human Rights and Rehabilitation, one of the NGOs that strongly opposed the project explained the change of heart, “The discussions have been very honest, very honorable and I believe that it is important that at a certain point decisions should be made for the interest of the country. And this is what we made.

“The issue of motivating us with money was not there. Whether we are corrupt or not, it’s up to the people of Karonga to judge us. But I believe we have made a better decision for the interest of this country.”

Mwakasungura says both the government and Paladin have agreed to address all the concerns raised by the civil society organizations.

John Borshoff, managing director of Paladin said his company will adhere to the terms of the out-of-court settlement. They include the establishment of a new NGO, which will be part of a broader monitoring group that will keep an eye on the environmental and health impact of Paladin’s mining operations.

The company has also amended its social responsibility program, which now includes the allocation of $8 million towards upgrading the water supply for the surrounding communities.

Only five countries in the world produce and export uranium -- Canada, Australia, Kazakhstan, Namibia and Russia. If the Kayerekera Uranium Project succeeds, Malawi will join them.--VOA