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Kenya ripe to adopt extractive industries transparency initiative

11 October 2013, 11:21 Robert Manyara

Nairobi - Kenya is ripe to adopt extractive industries transparency initiative as mineral explorers are recording an increased discovery of mineral resources and rare earth elements, expanding the mining ventures to various parts of the country.

Within a span of the last 18 months, mining firms have discovered oil reserves in Turkana, natural gas reserves in Malindi, niobium and rare earths in Kwale.

Combined revenue from these mineral exports is expected to earn Kenya over 240 million U.S. dollars annually. Mining and refining of the minerals to a clean usable product involves huge human and environmental outcomes which probably may result to long term effects.

Use of the toxic acids to explore the minerals and the release of the radioactive wastes stand out to be one of the major concerns that outlays the need for measures to guard against irresponsible disposal of waste by the mining firms.

"Exploration of minerals is a new venture in Kenya and we do not have a solid regulatory framework that guides on the holistic protection of the environment and the humans from the dangerous operations of the mining industry," said Mohammed Pakia, the Kwale County Natural Resource Network chairperson.

While the mining sector is set to boost the country's gross domestic product, the experts are pushing for the creation of definitive laws on the sharing of the benefits accruing from the natural resources.

Fights over the control of the natural resources have been a major cause of conflict among communities mostly living in the North Eastern and the Coast region where the highly priced minerals have been found.

"If you look around the world in areas where there is oil or any other mineral, communities have fought over the control of the resources. Many lives have been lost which calls for the need for the Kenyan government to be extremely cautious in the way it handles this mining sector," World Wide Fund for Nature Country Director Mohamed Awer told Xinhua on Thursday.

Under the Kenyan Constitution, of the royalties the mining firms remit, 80 percent goes to the central government, 15 percent to the devolved governments and the 5 percent to the local community.

Already, the National Environment Civil Society Alliance of Kenya has recommended for the involvement of the Commission on Revenue Allocation in regularly determining percentages of sharing accrued benefits to the taskforce preparing the Geology, Minerals and Mining Bill, 2012 and Policy.

While the government comes up with the new legislations, the country's mining sector is at the moment regulated by the Mining Act of 1940.

"The best way to avoid any arising conflicts because they are abound to rise if the communities feel dissatisfied is coming up with an agreed formula upon consultation with all the stakeholders, " said Jackson Kiplagat who heads National Environment Civil Society Alliance of Kenya Secretariat.

"This will ensure there is fair and equal sharing of wealth between the community, county and the national government."

Globally, the sector attracts heavy financiers seeking to minimize on the unprecedented losses with a greater effort to make maximized profits as projected in their long-term prospects.

This, according to the mining experts, opens avenues for corruption and unaccountability which can only be prevented through punitive measures spelt out in regulatory policies.

Kenya, now among the countries in the world producing some of the most scarce minerals, is ripe for establishing Extractive Industries Transparency Initiative.

EITI is a global standard set to ensure transparency and better governance reigns in the extraction of natural resources. Each mineral-rich country across the world uses the standard to establish its own depending on its specific needs.

Infusing this initiative will ensure all the oil, gas or the mining firms publicize their payments to the government.

Under the regulation, the government will also be required to make public all revenue in totality received including the taxes and the royalties.

"As Kenyans, EITI will help us know the agreements made, firms turnover and the revenue collected by the government because they will be published in the Kenyan gazette. That is what EITI will call for something not happening under the current laws," said Kiplagat.

"All we are encouraging is transparency and accountability because this is one of the most lucrative ventures in the world with high exposure to corruption."

In Africa, countries such as Tanzania, Zambia, Togo, Republic of the Congo, Mali, Nigeria, Gabon, Guinea, Ghana, Niger and Burkina Faso have adopted the EITI.

Following the principles of the EITI, an independent reconciler combines reports from the mining firms and the government regarding all their engagements, after which the complete report is published for public scrutiny.

"This makes the whole mining exercise transparent and accountable free from attempts of corruption. If this is overlooked, there is a great possibility for information withdraws which is very important in scrutinizing the underlining activities that may harm the lives of Kenyans," Awer said.

The experts are also calling on the Kenyan government to prioritize protecting the rights of its citizens with reliable financial and human muscle to explore the natural resources.

"We should not have all the licensing going to the foreigners. The government should be clear on which mining prospects should go to whom and what percentage. We should be able to learn from other African countries which have done well in this sector," Kiplagat said.

For instance, in the neighboring Tanzania which borders Kenya to the south, under its Mining Act of 2010, only Tanzanian citizens or companies under the exclusive control of Tanzanian citizens can be given mineral rights and licenses for small-scale operations.

As much as the East African nation expects to mint millions of shillings from the heavily financed industry, it will also have to strive to meet the agenda of the African Union's vision for the continent's mining growth.

The African Mining Vision 2050 emphasizes on the importance of having knowledge-driven sector embodied with equitable participation from all stakeholders to have an integrated approach to mineral resource exploitation.

- Xinhua


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