As Malawi's mining sector anticipates significant revenue growth, experts are pushing for governance reforms to ensure host districts benefit from mineral wealth.

By Kingsley Jassi: Mining is set to earn the country $30 billion to $43 billion in the next 14 years, but systems are said to alienate decentralization principles, limiting localization of benefits from mineral proceeds.. Calls have since been enhanced for restructuring of the sector’s governance structure and systems.. For instance, a Balaka mining project at Kangankunde, is expected to generate up to $114 million in annual revenue without Balaka District Council getting a cent,

crippling the district council’s even on matters that concern mining activities.. This is said to be weakening, not only the council’s capacity to transform the district using mining proceeds, but also mining oversight capabilities.. Malawi Economic Justice Network (MEJN) Executive Director Bertha Phiri called for a review of Malawi’s mining governance laws to empower district councils to play key roles at all stages of mining exploitation.. “There is a need for decentralization of functions and

the district councils should get part of the revenue.. “Mining reforms should bring mandatory disclosure of contractual agreements, and environmental stewardship should be devolved to the councils,” she said.. Mining policy expert, Grain Malunga, said the country may have overlooked the local content aspect in mining which requires building capacity at the local levels to ensure all activities around mining are using as much local labour, materials and technologies as possible.. “Local content is crucial

when it comes to localization of mining benefits but that requires preparedness and I don’t think the district councils have prepared enough,” Malunga said.. According to Balaka District Commissioner, Bibu Yusufu Mdala, in the current fiscal year, the council expects to collect K586.6 million out of the K55.8 billion total annual expenditure plan, making it fully dependent on the central government and donors.. This is the reality of all districts that host mining ventures as

current revenue sharing framework does not include the host district councils, except where a mining company signs a Community Development Agreement (CDA) which avails 0.45 percent of annual revenue.. In a previous interview, governance expert Henry Chingayipe supported the idea of Sovereign Wealth Fund but stressed on the need to have stringent measures on the use of the funds, proposing significant amounts to be invested in the communities around mining areas, research, infrastructure and mining

investments.. Malawi Mining Regulatory Authority has not responded to a questionnaire on the proposed fiscal devolution and the push by others to have a comprehensive review of mining laws.

mining sector, mineral wealth, revenue sharing, decentralization, economic development, mining governance, Balaka