All is set for commencement of formal gemstones trading in the country following a decision by the Ministry of Mining and the Reserve Bank of Malawi (RBM) to mandate the Export Development Fund (EDF) to start purchasing precious stones in the country.
In an interview, Minister of Mining Albert Mbawala confirmed the development, saying a Precious Minerals Unit has been established at the EDF and key positions have been filled, ready to roll out the programme.
Mbawala said the Unit will be going around the country in hotspots where such minerals are mined for purchase but will also welcome walk-in sellers at its offices.
He said the initiative will be backed by formalised artisanal and small-scale miners (ASM) sub-sector.
“To date, a total of 32 groups of informal ASM operators across the country have been formed and some of them have undergone, or are undergoing, the full formalisation process. Some 17 groups were already formalised while two are at the final stage of formalisation.
“You may wish to know that this intervention is empowering ASMs with knowledge on the rule of law in the mining sector and is promoting wealth creation. in Addition to the ASM formalization initiative, the ministry is working very closely with security agencies, including the National Intelligence Service, Immigration Department, Malawi Police Service and the Malawi Defense Force to curb illegal mining in the country. A number of illegal immigrant buyers are being arrested,” Mbawala said.
Meanwhile, Mbawala revealed that, cumulatively, gold purchases have reached a total volume of 186.96 kilogrammes (kg) at a total purchase cost of K9.4 billion, as of November 30 2022.
According to the Bullion Vault’s gold price chart, gold prices reached a nine-month high at $61,935 per kg on Monday.
This means the country could realise $11.7 million (about K12.9 billion) if it were to sell its gold reserves, all factors being equal.
National Coordinator for Natural Resources Justice Network Kennedy Rashid commended the government for the move but was quick to say more needs to be done.
“Considering that we are making baby steps, it is commendable to have a formal market for gemstones. However, these markets should be decentralised.
“From what we have experienced with gold sales, best practices are not being adhered to. It doesn’t make sense for the RBM to be going up and down Malawi with money buying from people; the best way could have been to establish an office at district level to buy from miners,” Rashid said.