BY BACHA ZEWDIE
The Ministry of Mines recently submitted a report to the Committee on Mining and Industry Affairs of the House of People’s Representatives regarding the current state of the national mining industry in terms of the activities carried out in the mining sector, the gaps encountered in relation to the development and marketing, and a wide discussion was held.
According to Million Mathewos, State Minister for Mines and Oil Development Sector Control at the Ministry of Mines; in the last three to four years, better results were achieved, especially in 2021 and 2022. The government made policy reforms to enable the total gold production to be deposited into the National Bank to earn better foreign exchange. The State Minister mentioned that since the middle of 2021/22, gold production has been going out of the country through illegal (contraband) means. He said that local and foreign forces have been involved in this activity and pointed out that the illegal activity is increasing.
He said that this illegal transaction has been heightened in this half of the year. While explaining the source of the problem and the solution taken accordingly, Million said that controlling the illegal activity is being done attentively considering it among the tasks reviewed every month.
As to him, discussions were held with regional administrations and the security structure on issues that could solve the problem. Especially in Gambella, Benishangul Gumuz, Oromia and Southwest Ethiopia regions, where the gold development is widespread and illegality is prevalent, explaining the problem to the leadership and seeking solution collectively has been done. The work continued closely with the Prime Minister’s Office and regional security structures. The overall result indicates that there are issues that need the Ministry attention.
Despite the increase in production, the State Minister announced that earning the targeted foreign currency in the fiscal year was impossible due to the extension of illegal trade. Million further stated that there are issues that promote illegality that requires coordinated effort with the bodies outside the Ministry of Mines.
One of the problems Million specifically raised is that of license management. He mentioned that regional governments should manage properly the licenses they provided to traditional gold producers’ associations. In terms of buying gold produced by the associations and delivering it to the national bank, there is a wide performance problem, he said.
The number of unions in each region and district and their production volume per day and month is known. Therefore, the management, along with the senior leaders of each region, is working mindfully to solve the administrative problem. In this regard, states are taking action. Regarding the illegal foreigners, Million said that they send the product they made using different machines to their country illegally instead of sending to the National Bank. In this regard, concerted legal action is being taken with the Federal Police and regional security structure.
Minister of Mines, Engineer Habtamu Tegegn said, “We should use the potential of the mining sector to grow our country’s economy.” He pointed out that support is being given to the regions in Oromia, Benishangul Gumuz, Gambella and Southwest Ethiopia to prevent the illegal production and trading of gold in particular. He said that not much attention was paid to the mining sector earlier to the past five years, but recently mining has been given attention as it is one of the pillars of the economy.
He mentioned that gold, tantalum, methane, oil and natural gas and other minerals are found in high deposits in Ethiopia, but the country’s mineral wealth is not organized in a proper database. Regarding cement production, despite the production capacity is 14 million tons; only six million tons are being produced. Efforts are being exerted to export cement on top of satisfying local need, he said.
To this end, a huge cement factory is being established which will start production after one year. There is 351 billion cubic meters of potash resource alone so that the capacity of mining projects should be built well, he stated. Since there is a huge amount of resource to produce fertilizer in the country, diligent works are underway in this sector to save the 1.2 billion Dollars that Ethiopia spends on buying fertilizer every year. The construction of the Ethiopian Geological Science Laboratory is being focused on institutional capacity building, he added.
Regarding gold production, there are projects that can produce at factory level such as Midrock, and in the next two years, efforts are being made to increase the product at the national level by five folds. The Minister also pointed out that practical steps are being taken to prevent theft and illegality in the mining sector. The Standing Committee on Mining and Industry Affairs of the House of People’s Representatives also stated that a strong operational system supported by technology is needed to prevent illegality and theft in the mining sector.
According to Amarech Bakelu (PhD), Chairperson of the committee, unless national mineral production is managed in a transparent manner, it will be difficult to prevent the illegality currently observed. As the mining sector has a high role in creating ample job opportunities for citizens, work should be done with this in mind. An organized database should also be created to attract large investors in the mining sector, she emphasized.
The Chairperson also announced that there should be a reliable and modern operating structure for the mining companies to submit the gold they produce to the National Bank. There are good beginnings in terms of setting a policy direction with the help of a decree. “For this, she said, the participation of the people from whom the wealth is being stolen and all the stakeholders is important.” the mining sector is harmful to the country, the government and the people, she stressed that there should be a clear procedure to prevent this problem from happening.
The Federal Government is working together with the Ministry of Mines, the gold mining regions, the Federal Police and other bodies to control the illegal activities that are taking place in the mining sector, especially in the production and marketing of gold. Recently, the National Security and Safety Joint Task Forces have arrested individuals and their associates engaged in the illegal exploration and production of gold and various minerals, according to the ENA report. Many foreigners are among those involved in this illegal act.
As the report indicated; 45 foreigners and three Ethiopians who entered Ethiopia illegally without valid travel documents, entry visas and residence permits engaged in prospecting for gold and various minerals in the Gambella region were captured red-handed and are being investigated. The report also indicated that 47 foreigners engaged in the same illicit deeds were captured in Benishangul Gumuz region.
In addition, nine private limited liability companies and seven Ethiopian individuals were captured red-handed and are being investigated, the joint task force announced in a statement. The joint task force further announced that the strong monitoring of foreigners engaged in illegal mineral exploration, associated with Ethiopian individuals and private limited companies will continue to be strengthened in other regions too.
The joint task force, which thanked the society for its sincere cooperation, called on the society to strengthen its cooperation by coordinating with the security agencies to prevent and control such criminal activities that are taking place in the country’s economy in any area.
As can be understood from the report, the illegal activity is not only seen in the illegal trading of gold; foreigners and their associates who have not been licensed in mineral exploration have also been found engaged in mineral exploration and production. It can be understood from the statement of the task force that the problem is widespread. Just as the task force has brought these bodies under control, it should also strengthen its extensive efforts to control the entities involved in illegal gold trading, it was stressed.
THE ETHIOPIAN HERALD TUESDAY 2 MAY 2023
