Geological expert and former Minister of Mines and Energy, Grain Malunga
says the local mining industry has the potential to surpass agriculture as the number one forex earner.
For a very long time Malawi has depended on agriculture as the mainstay of its economy but of late there have been calls to look at alternatives and mining has been touted as one of the sectors.
Speaking in an interview with Nyasa Times, Malunga said Malawi is not fully utilising its existing mineral resources because of lack of public investment in the mineralssector.
He said: “ Priority should be put in exploration of minerals to the level that investors can be attracted to put their money for feasibility studies and mining. This is true with the coal sector where mining is done without more information on continuity and tonnage.
“The efforts being undertaken by the local coal miners such as Jalawe Coal Mine need to be supportedin order to grow their capacity to contribute to import substitution.”
According to Malunga, the mining industry is hampered by lack of capital and technology leading to companies operating blindly.
Malunga said that this problem can be sorted out through proper tax incentives and basic knowledge generation to attract private investment as is the case right now.
He said Malawi has huge potential to produce minerals suchas gold, coal, rare earths, niobium and uranium which can in the end spur sustainable economic growth.
“In Malawi we have companies such as Mean Jalawe, Nkhayuti, Nkhachira and Lisikwa which are locally owned and are helping government in jobcreation and saving forex. This effort needs to be guarded jealously and harnessed to grow the industry.”
Former Chief Geologist, James Chatupa concurred with Malunga that the mining industry in Malawi is not being fully utilised but has got huge potential.
Chatupa said that Malawi spends a lot of its hard earned dollars importing coal from neighbouring countries such Mozambique.
“Companies such as Mean Jalawe, Chombe , Kasikizi, Nkhayuti and Nkhachira havethe capacity to meet the local demand and even meet the demand ofthe export market. What government needs to do is to
support local companies in growing their production capacity through removal of non-tariff barriers.”
Mining industry in Malawi is currently contributing about 1percent to the GDP and has the potential to contribute 20%.
Currently the industry employs about 40 000 people and hasthe capacity to employ about 200 000 people.
Since independence, Malawi has been depending on agriculture as number one forex earner but lately mining has been identified as a priority sector for economic diversity alongside tourism.