Non-compliance to regulatory requirements and breaches of licence provisions are rampant in the mining sector, audit findings indicate.
The Mining and Minerals Regulatory Authority (MMRA) conducted a nationwide Mineral Licence Compliance Audit covering the period between 2020 and 2025.
MMRA’s findings has since triggered a 30-day ultimatum for licence holders, who have to regularise their operations or face cancellation.
In a written response, MMRA Director General Mphatso Chikoti said the audit revealed extensive breaches across exploration, medium and small-scale mining licences.
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“The audit has revealed widespread non-compliance across the sector, including non-payment of ground rent and mineral royalties, failure to submit statutory reports, and holding of inactive or dormant licences,” he said.
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The audit identified at least K413.6 million in unpaid ground rent, including K333.2 million owed by exploration licence holders and K80.4 million by medium-scale mining operators.
Beyond the financial losses, compliance gaps were found across the sector, as over 150 exploration licences had overdue reports while 96 medium-scale operators failed to submit mandatory monthly returns.
At the small-scale level, the authority found that all active small-scale, reconnaissance and non-exclusive prospecting licence holders had not submitted required reports while 1,044 operators had not paid mineral royalties, according to verification with the Malawi Revenue Authority.
The audit also exposed a growing problem of inactive licence holding, where companies secure mineral rights but fail to develop them.
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Under the Mines and Minerals Act of 2023, large-scale mining firms are required to begin development within 18 months and production within five years while medium-scale operators must begin development within six months and production within 12 months.
The audit comes at a time Malawi is seeking to attract investment into mining as a key driver of economic growth.
In its June 2025 Global Economic Prospects report, the World Bank highlighted that global investment flows into extractive industries were increasingly influenced by governance, transparency and regulatory enforcement issues.
Mining policy analyst Paul Mvula described MMRA’s move as a long overdue intervention that exposes long-standing weaknesses in the sector.
“The findings highlight the systemic weaknesses we have been talking about over the years,” Mvula said.
Economics Association of Malawi President Bertha Bangara Chikadza said governance gaps continued to cost Malawi some economic opportunities.
