Africa’s civil society organisations in the mining sector should mobilise communities to force governments and companies to implement the Africa mining vision (AMV) in its fullest, including complying with human rights and environmental and safety standards.
This was one of the main recommendation from the Civil Society AMV conference hosted by the Southern Africa Resource Watch (SARW) together with its partners, the Third World Network Africa, Tax Justice Network, Publish What you Pay, The Zimbabwe Environmental Law Association and the Norwegian Church Aid from October 23 to 35 in Johannesburg. The meeting was also attended by the Africa Development Bank (AfDB), the Africa Mining Development Centre (AMDC), and UNDP.
The conference was held to assess progress of the AMV in the past decade and to recommend a set of measures that will help increase visibility of the vision and its implementation by African governments.
According to an Africa Union representative, Paul Msoma, 32 states in Africa are implementing various aspects of the AMV by incorporating it into their mining policies. The AMV adopted in February 2009 by the African Union Heads of State and government, is Africa’s overarching framework for achieving inclusive, sustainable mineral-based structural transformation on the continent.
The conference was the second forum of the Civil Society Organizations CSOs on Africa’s mining vision. It followed up the conference, held in Zambia in 2014, that evaluated five years of the implementation of the AMV.
The meeting recognized the AMV had made great stride since its adoption with the adoption of the action plan, the drafting of the Africa Mineral Governance Framework (AMGF) and Regional Economic Blocs, which are developing different instrument to promote its implementation.
Despite this progress, the Director of SARW, Dr Claude Kabemba, says the AMV has so far not had “visible impact “on the lives of people in Africa, especially mining communities.
The conference measured the AVM using the six pillars contained in the AMGF, which are the legal and institutional framework; fiscal and revenue management; linkages and diversification; artisanal and small-scale mining and environmental and social issues. Below are the recommendations for each pillar and the challenges that have been identified.
With regard to the legal and institutional framework, it is recommended that the continent develop a model law for contracts and licensing to deal with corruption and illicit flows in addition to developing country and regional level skills for contract negotiation.
There is need to improve access to information on quantity and quality of mineral reserves, political awareness of the AMV, more civil society, parliamentary, and community participation including gender discussions on how women can participate actively.
In terms of geological and mineral information, it was recommended that Africa increases its capacity to conduct research and mineral resources explorations; increase visibility of AMV in the mining sectors and make it more enforceable, lobby for governments to increase fund allocation to geology training, research and exploration, strengthen geological data capturing and systems and making the information accessible to the public and new acquisition of new technologies and training.
Msoma says it is important to understand what minerals the continent has and where are they. “Africa lacks in reporting codes and frameworks. According to Professor Jewette Masinja from the University of Zambia, Africa holds 30% of the world’s mineral reserves while 11 African countries are among the top 10 global resource countries in at least one major mineral. The continent has the greater share of precious minerals and gemstones.
Meanwhile, for fiscal and revenue management, the recommendation was for model laws that help to strengthen capacity of Africa to fight illicit financial flows, corruption, and improve mining administration and management skills.
It was also necessary to put in place efficient and effective revenue capturing systems including taxation; distribution of revenue systems; transparency mechanisms that allows the public to participate; the ploughing of profits into community projects; transfer pricing policies and monitoring and harmonization of fiscal regime models.
Tax Justice Network representative, Michael Otieno, says illicit financial flows and ensuring that resources remain on the continent are some of the major challenges.
Silas Olang, who was speaking on behalf of NRGI, notes that there is a lot of discussion around revenue maximisation and not on optimisation. “Optimisation looks at the revenues that are due to government and how they will be managed. NRGI looks at testing fiscal regimes in the context of the extractives sector. How does it respond to the initial stages of the mining sector? How does the regime respond to cost scenarios, price changes?”
An example is Zambia, which since 2008 has had seven changes in its fiscal regime on the taxes on production and taxes on profitability. In 2016, Zambia introduced a sliding royalty tax to get more revenue when copper prices were high. Olang notes that Africa missed a lot when the gold prices were skyrocketing because regimes in Africa were not flexible to accommodate the gold prices. He adds: “If your fiscal regimes are porous, they will not address tax avoidance and evasion”.
For linkages and diversification, it was recommended that Africa beaks the enclave nature of the mining sector.
“It must use the minerals, including development minerals, as a basis for development and industrialisation. Local content, which is concerned with the contracting of supply of goods and services to mining companies is not negotiable.
“Linkages and diversification will not happen automatically, African governments must invest in skills (STEM and research and development) to be able to successfully achieve linkages and diversification. Civil society must get involved to push government to invest budget in this sector.”
Minerals are finite hence the need to create linkages, promote re-investment and diversified economies using the mining sector. These could be financial, consumption, production and skill linkages. Key to this is disclosure of revenue, infrastructure sharing, lessening capital flight, regional linkages, Industrialisation and skills transfer
With regard to artisanal and small-scale mining, it was recommended to formalise the artisanal and small-scale mining (ASM). While there are efforts being done, there are not enough. ASM is designed to contribute directly to local development.
“In most of the countries it has been hijacked by foreign elements in connivance with political elites exploiting the artisanal miners. Most governments have progressive laws and regulations on ASM, these laws must be implemented. There is concern that this industry remains criminalised because it is defined as “illegal”, it is not supported and is used as a source of illicit flows by corrupt business and government leaders.
“The industry’s space is also being exploited by foreign nationals with Chinese cited as among those actively participating in it. There is also worry that this industry is promoting child labour. It is a challenge to adequately monitor the environmental impact as well as enforce health and safety measures,” it was revealed at the conference.