The Ministry of Mining is implementing a countrywide industry formalisation programme aimed at ironing out challenges faced by artisanal and small scale miners (ASM) when accessing finance.

President Lazarus Chakwera said this on Tuesday when he faced Parliament for questions.

Chakwera said artisanal and small miners face challenges when they want to access funds because of disorganisation and lack of ownership or user-rights, which prevent banks from giving loans to industry players.

He said, to iron out this problem, government is implementing the formalisation programme which will make sure that the sector is organised and less risky to banks.

“The programme involves organisation of small-scale miners into mining cooperatives, provision of training in sustainable mining including value addition and business management, and licencing and empowering them and facilitating well-structured and legitimate markets for mineral products,” Chakwera said.

He added that, so far, 40 groups have been identified under the arrangement and 14 groups have been formalised.

A local firm, Nyasa Mining, says access to finance has been one of the major factors impinging growth of artisanal and small-scale miners.

Nyasa Mining Chairperson Percy Maleta said easing the pressure faced by industry players would be an ideal step towards growth of the industry.

“Malawi is talking mostly about gold which is being mined by artisanal and small scale miners. Therefore, the government is doing is right because it will support our people in the rural areas,” he said.

Natural Resources Justice Network Chairperson Cossam Munthali said more needed to be done to improve the industry’s contribution to the national economy.

He said the countrywide formalisation programme should focus on empowering Malawians rather than ghosts who want to swindle from the mining sector.

“Government should go back to the drawing board and this formalisation should be decentralised so that councils are aware of the people who are doing the mining and the funding should be supported by the councils in mining hotspots,” he said.

Last year, Chakwera addressed the nation on the potential of the country’s mining sector, saying, if revamped, it can support tobacco in exports and foreign currency generation.

Figures presented by Chakwera, when delivering his State of The Nation Address recently, show that Malawi has raked in $3.2 million (about K2.6 billion) from gold in six months.

He said Reserve Bank of Malawi bought 58.1 kilogrammes of gold valued at $3.2 million.

Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.

He is however flexible as he also writes about current affairs and national issues.

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