The extractive sector in Togo consists mainly of the mining of phosphate and, to a lesser degree iron, gold and diamonds, plus the extraction of groundwater for commercial purposes. In 2012, according to the recently published EITI Report, the sector generated US $33 million for the state budget, which contributed to an increase of 65% of the country’s total budgetary receipts for that year. The report highlighted significant increases in the production of all of these minerals. By the end of December 2012, almost 4,000 Togolese people were employed in the sector.
Barter deal missing
However, the recently published 2012 EITI Report revealed that information was missing on a barter deal. The Société Nationale Chinoise des Travaux des Ponts et des Chausées, a Chinese company, benefitted from a tax exemption on the use of construction materials for land development. The report concluded that the tax exemption for these minerals amounted to a barter agreement and should be reported as such in accordance with EITI Requirements. The company did not submit the required information.
Improving mining sector governance
Togo’s current mining code, effective in 1996 and revised in 2003, requires licenses for any party wishing to undertake mining activities in the country. However, there is no public mining cadastre against which to check this. Another article in the mining code requires that the government have a 10% stake in all operating mining companies, except for in artisanal activities and construction.
Togo’s Minister of Mines and of Energy, Dammipi Noupokou, launched a proposal for a new mining code in January 2014. “The government wants a transparent and participatory process for all the country’s socio-economic layers”, declared the Minister. He continued that “in the last five years we have received an increasing number of requests for licenses for exploration and extraction, for all minerals, leading to an urgent need to establish an institutional and regulatory framework that is efficient for the organisation and management of these licenses." The challenges identified by the 2012 EITI report will inform these important reforms.