Paladin can pack up and go: Malawi needs win-win deals with investors
Issues surrounding Kayelekera Mine in Karonga have for a long time been a bone of contention as some quarters feel that Malawi government was hoodwinked in signing a deal that does not bring direct benefits to the citizens.
Lately, Kamuzu Chibambo who is President of Peoples Transformation Party (PETRA) and civil rights activist, Collins Magalasi, have added calls upon government to review the agreement so as to make it viable with the common man in mind.
The recent calls also come on the heels of another expression of dissatisfaction from some Karonga residents who questioned the mining firm on why it is failing to develop the area contrary to what it promised when it started operations at the mine three years ago.
Why on earth should Malawi Government only have a 15% stake in such an investment on top of giving Paladin breathing space on taxes for a period of ten years?
Blame has mostly been heaped at the Bingu wa Mutharika’s administration with many observers wondering whether money exchanged hands in view of such a one sided deal.
As Africans we are faced with a common problem among our leaders. Foreign investors know that our politicians do what they do mainly for survival and they take advantage of that.
Most of the deals that are sealed at Capital Hill come with scant details because those who know the truth are palm oiled. This is where as a country we need to get serious when it comes to declaration of assets by our Presidents, cabinet ministers and other top government officials.
Paladin should not treat Malawians as naïve by saying that investors will be scared if we review the current agreement.
That line of thinking brings Zambia into my mind. There was a period in the mid 90s when their mines were being abandoned by investors (mainly Westerners) who deemed them unviable at that particular time. This move created room for Chinese and other Eastern investors to move in and luckily years later demand for copper rose again and the markets responded favorably.
It is a big lie to say that Kayerekera will become unattractive to investors if Paladin moves out. The day after they close operations, a thousand companies will line up to bid for such a big opportunity. Whether they will bring their own share of bribes, we cannot speculate here.
Need we a reminder of how Zimbabwe stamped their foot and made their voices heard? When President Robert Mugabe introduced a law giving indigenous business people 51% stake in any investment by foreign stakeholders, people thought he was adding salt to the injury of the already faulting economy.
That wasn’t to be the case, Mugabe told foreign investors point blank that if they did not agree with the law, they were free to pack and go. Do your counting if you follow these things, how many left? Very few if not none. Many who grumbled in the first place abided by the law and gave away their strongholds. To cut the long story short, their economy is picking up despite sanctions from the West.
Back here, let us not be scared by the Paladin bargaining card of “you mistreat us, you lose investors”. They are just using the same script rather in a wrong cast. We will not ask for 51 %, we might ask for more or less, that is for us to know and for them to anticipate.
My take is that if what we are asking for is too much for Paladin to take then they can go. They must remember that Kayerekera Mine is located within our borders and it belongs to the people of Malawi. If they got the current deal through bribes then let them prepare trillions of bribes for each and every Malawian.
This mine is our asset and we must see the benefits now and generations to come.
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