Malawi is a small producer of uranium, gemstones, coal and construction materials, and the government is promoting investment in petroleum and minerals such as graphite. Mining is does not play a large role in Malawi’s economy, accounting for less than 1% of the national GDP in 2020. The forestry sector accounted for about 7% of GDP.
The government has indicated plans to improve the regulation of the mining sector to develop the economy. Malawi EITI (MWEITI) has been using the EITI process and reporting to inform dialogue on regulation of the sector, revenue sharing at the community level and measures to mitigate corruption.
Malawi EITI has facilitated discussions aimed at addressing anti-corruption allegations in the renewal of a mining license. The case is currently under review at the Anti-Corruption Bureau (ACB), with progress updated in EITI Reports.
Recommendations from Malawi EITI Reports, for example on amendment of extractive sector fees, have informed debates and discussions and contributed to the development of the 2019 Mines and Minerals Act.
Malawi EITI has used EITI reporting to improve transparency of the country’s forestry sector, a significant contributor to government revenue and national GDP.
The mining industry is regulated by the Department of Mines, which is responsible for granting mining licences and administrating the sector, and the Malawi Revenue Authority (MRA), collects tax revenues under the Ministry of Finance.
Licenses and contracts
Mining licenses are awarded on a first come first served basis, while oil and gas licenses are awarded through restricted competitive tenders. Malawi has a public mining cadastre available online.
The Mines and Minerals Act provides for the establishment of a Mineral Resources Committee – composed of professionals in mining, geology, environmental issues, land and physical planning, police and customs – which assesses license applications and makes recommendations on license awards. Mining legislation also allows for the Minister of Mines to conclude agreements with extractive companies directly.
While Malawi does not have legislation mandating the disclosure of contracts, some extractive contracts are disclosed via resourcecontracts.org.
Malawi does not have a legal framework mandating the disclosure of beneficial owners. However, the Department of the Registrar General (DRG) implements the Malawi Business Registration System (MBRS) which collects ownership information of companies. The Financial Crime Act (2017) provides a definition of beneficial ownership.
Malawi’s mining and oil and gas legislation does not provide for subnational transfers of extractive revenues. To strengthen transparency over expenditures, Malawi EITI reporting discloses payments related to the transport sector, training levies and social payments.
Malawi EITI (MWEITI) is administered by the Malawi Multi-Stakeholder Group (MSG), which is hosted by the Ministry of Finance. The MSG is chaired by Mr Kenneth Matupa, Director of Revenue at the Ministry of Finance. The MSG is comprised of members from government, industry and civil society.
Malawi was found to have made meaningful progress in implementing the 2016 EITI Standard in February 2019, following its first Validation. The Validation identified 8 corrective actions to be addressed by the country’s next Validation, commenced in January 2022.