BY BACHA ZEWDIE
The mining sector is one of the five main sectors that the government has identified as the pillars of Ethiopia’s economy in its ten-year perspective plan for homegrown economic reforms. Following this, favorable conditions have been created for researches to be conducted to solve operational, policy, guidelines and related problems that have been bottlenecks in the sector.
This will be of great benefit in order to use the country’s mineral resources’ potential, especially for investors to work in the sector on a wider scale and to be more efficient; to capacitate small scale producers, to improve and change the traditional minerals production etc. The same is happening in marketing.
The government has been carrying out various activities to revive the mining development and marketing, which has been stagnant due to the COVID-19 pandemic, which has been a global threat and security breaches. Various symposiums and recognition programs were conducted in the Regions.
The International Symposium on Mining and Technology, which was held for three days in Addis, will also be of great benefit in promoting the country’s potential, attracting investors, etc. It has created an opportunity for domestic and foreign companies engaged in mineral development, business and technology to meet. It is a demonstration of the efforts being made to achieve the country’s goal of replacing imported mineral products in the country by creating capacity for mineral development.
In addition to local and foreign companies engaged in the sector, participation of senior government officials and invited guests on the symposium, which aims to promote mineral resources for construction and industrial inputs, including precious metals for jewelry to the rest of the world and attract investment, is another indication of the attention given to the sector. The Ministry of Mines, which leads the sector, plays a major role in making such efforts.
According to Engineer Takele Uma, Minister of Mines, the sector is one of the identified economic pillars. The mining sector is mentioned among the homegrown economic reform measures taken by the government.
The minister said that since the national reform, the government has carried out large-scale activities to revive the sector in the last four years. He pointed out that among the primary reform measures taken; he mentioned the issuing of policies and proclamation. Thus, the government has created a favorable environment for attracting investment and enabling the investor work. Pointing out internal security problems the country faced is being resolved, he said that holding an international symposium was the right time to bring the activities started in the sector to a better level.
According to the minister, there are mineral resources in Ethiopia that have been identified by studies by the Geological Institute of Ethiopia and other bodies and can be used for various purposes for the development of the country’s economy.
However, he pointed out that because of developing the mineral resources is not supported by policies and guidelines that attract investors, the benefits from the sector are not at a level that will boost the economy. Due to this, inputs used for industry and construction sector have been imported at high foreign exchange costs.
He said that it is necessary to improve and change procedures to increase economic capacity in order to use own resources and provide them to the foreign market. “We are promoting our mineral wealth at the symposium; selling what we have produced; giving local companies in the sector the opportunity to gain experience from those with better technology and create opportunities for them to work in partnership to create better mining development in our country,” he said.
Mentioning that manufacturing industries from small to high level presented their products and services at the symposium, he also pointed out that there were construction and industrial products offered at factory prices.
In developing countries like Ethiopia, finding skillful experts and seeing technology-assisted work are among the challenges of the mining sector, the minister mentioned. As a result, in Ethiopia’s experience so far, even minerals such as gold are sent outside for laboratory testing and a lot of money is paid for it.
According to him; capacity building is needed to avoid the cost via doing things independently and the government is moving in this regard. In order to strengthen the efforts in this regard, good experiences can be obtained from the companies and technology providers with international experience participating in the symposium.
Effort being made to domestically supply coal, which is used as a power input for cement manufacturing industries, is among the efforts towards self-sufficiency. Tracing on the existence of the resource, the only thing expected is making it convenient for the investor who wants to work in the sector. Investors are showing interest in this regard. Solely after the announcement that a symposium would be held in Ethiopia, three companies showed interest in coal development. There are those who have obtained license for this development. Working to attract those who are interested and participate in the development, it would be possible to solve the current problem of supply and price hike of cement within four or five years.
The government is taking a determined position to solve input supply problem raised by the manufacturing industries. The manufacturing industries are also expected to fix the gap observed by them.
Out of the 14 cement manufacturing industries in the country, only four are fully functional. Most have a fundamental operational problem or gap. They produce less than they are expected to produce. This is the fact the government knows well and they also believed.
The minister said that they should examine themselves why they are producing below capacity while using the same resources as those who are producing well. He stressed that the industries should be ready to solve their internal problems. The government has reached an agreement that there should be a body to help them by establishing a task force. In this way, efforts are being made to solve the sector’s problems by filling gaps and providing necessary things, and doing what is expected from the government, the minister said, adding that the demand for resources from the user side should not be forgotten.
At the same time, the minister also mentioned the government’s efforts to provide temporary and permanent solutions to the gap in steel supply and rising prices. In particular, he pointed out that it will be used to solve it in a sustainable way. The symposium is expected to support all these government schemes and activities.
Kostentinos Berhe (PhD), an economist, said that the symposium held during this time of establishing national peace is expected to promote the country and attract investment.
Another thing that needs to be considered with the symposium is the need to ensure the readiness to convert the benefits from the symposium into action. In previous experiences, foreign companies that have entered the country to engage in mining work have stopped their work and returned back. For example, despite efforts made as a country to develop and use natural gas, they have been rolling for years without being implemented. Therefore, gas product is being imported with high foreign exchange. This product is currently increasing in price and putting pressure on the country’s economy. He said that the symposium can help to solve such problems.
Recalling the unrest in the country for the past two years has put pressure on the mineral development, Dr. Kostantinos pointed out that the current peace should be enhanced more, especially in the areas where mineral resources are found.
In order to attract mining investment, the areas where the mineral is located should be freed from security threats as the issue of security may be one of the questions raised by the international companies participating in the symposium. They would be interested if the question could be answered, he said.
According to Dr. Kostantinos, the responsibility for achieving results in the field should not be the sole responsibility of one party. Although the majority share belongs to the government, bodies from the regions and kebeles where the mineral is located should work responsibly.
While Ethiopia has potash mineral resource, which is used for fertilizer, it imports fertilizer for agriculture. This is very damaging for a country whose economy is based on agriculture. Everybody is required to act with attention and responsibility to develop the mineral in the country.
Pointing out mining investment is high and the income as well; Dr. Kostantinos said that it is essential to be ready by making the infrastructure comfortable that meets the needs of the companies to earn income from the sector.
As to him, it is not necessary to trust all companies and being careful is essential. It has been stated at various times that there are companies whose licenses have been revoked for not developing the mine sites they were given and for not using them within the time limit. Such a problem could put more pressure on the government. Consequently, it is necessary to ensure that they have the skills, financial capacity and market to work before the license is granted.
He recalled that African countries with mineral resources such as Congo have been affected by robbery due to the lack of proper precautions. The only way to prevent the problem is to create a competent public administration that can lead and manage companies, especially in the areas where the minerals are found.
Dr. Kostantinos pointed out that mineral wealth is considered at a high level. It can generate wealth even better than the results of agriculture. It can also substitute imported products. He mentioned as an example that there are types of minerals used in car batteries, mobile phones and other electrical sources in the country.
THE ETHIOPIAN HERALD WEDNESDAY 16 NOVEMBER 2022
