MINING SECTOR IS AN IMPORTANT GAME-CHANGER FOR KENYA'S ECONOMY

Kenya like most developing countries is struggling with a high population growth and a low increase in economic growth rate largely supported by the agricultural sector. With a moderately developed industrial sector, benefits accruing from agriculture are sub-optimal given the weak value chain and export of mainly unprocessed raw farm produce therefore denying the country the much required foreign exchange.

New discoveries in the mining sector in the country are therefore good news that should be celebrated by all. The discovery of significant deposits of oil in Turkana County and the huge deposits of niobium in Southern Eastern Kenya are a strong pointer that Kenya could be holding huge deposits of other minerals that have not been discovered and exploited and which could tremendously change the economy of our country. Other minerals found in the country beside oil and niobium include the significant quantities of soda ash (Trona) around Lake Magadi, Fluorspar at Kimwarer in Kerio Valley, Titanium in Kwale, Malindi and Lamu, gold deposits in Kakamega, Vihiga, Migori, Transmara, Bondo, Siaya, Pokot and Turkana,   Coal  in Mwingi and Mutitu, Iron ore in parts of Taita, Meru, Kitui, Kilifi and Samia, Manganese ore in Ganze and Mrima Hill  in  Coastal region, Diatomite  at Kariandusi near Gilgil, Vermiculite on Kinyiki Hill, Gypsum in El Wak,  Garissa, Tana River, Kajiado and Turkana, natural carbon dioxide at Kereita in Kiambu and a variety of gemstones in Taita, Kwale, Kitui, Mwingi, Kajiado, Isiolo, Pokot and  Turkana and natural gas deposits in Lamu. All these are valuable resources that the National and County governments need to harness for the benefit of the people of this country. Available data from the Kenya National Bureau of Statistics show that in 2011, the mining industry contributed an estimated Kenya shillings 7.246 billion to the economy.

Despite such as handsome income from the sector, amounting to approximately 0.7% of the GDP, the truth is that the socio-economic potential of Kenya’s minerals deposits is not yet fully evaluated. The sector is also predisposed to unscrupulous dealers who exploit the resources without paying relevant government royalties nor using sustainable environmental mining practices. Taking the niobium deposits as an example, the deposits found in the country are considered the fourth largest in the world with Brazil holing the world 97% of the mineral. If fully exploited, this mineral which has many uses in the automobile industry, the petro-chemical sector, heavy engineering, power plants, aircraft engines, particle accelerators and magnetic resonance imaging (MRI machines)  has potential to earn the country over 280 million dollars in revenue.

Already, the horizon is bright, His Excellency the President established the Ministry of Mining to guide this important sector in realizing its potential for national socio-economic development. As the new Ministry set out to work, the first task should be to take stock and inventory of each and every single mineral that exists in this country and in determining how best they could be exploited for the benefit of the people of our country. With the new Geology, Mineral and Mining Act 2012 enacted last year, the nation must prioritize its mining agenda and seek ways of how best to take advantage of the vast mineral resources available in the country. The Act establishes the Kenya Geology, Mineral and Mining Authority (GMMA) as an agency to supervise and coordinate the geology, mineral and mining activities in the country. The authority as principal instrument for geology, mineral and mining issues in the country must move with speed to develop and implement all the required policies required for the growth of this sector. Among other issues, this authority should establish and review in consultation with stakeholders, policies and laws on mining and minerals and ensure that mining takes into consideration the local communities interests, best practices in environmental conservation and equitable profits and royalties sharing mechanisms between the locals, counties and National Government. Already the Act pegs sharing mining royalties as 10% to host communities, 15% to county governments and 75% to National Government.

The Government however must build the required frameworks that may be a hindrance to robust development of the sector. Key areas that warrant urgent attention include; development of specialized trained manpower for the sector, development of roads and rail network for ease of transport of raw minerals from the mining sites to processing industries and to the ports for export, establishment of value chain addition to ensure value addition of minerals and developing effective polices and tax regimes that encourage local and foreign investment in the sector. For example, the human resource capacity within the country is limited with the few Kenyan experts in mining trained outside the country. This has led to importation of skills and labor force and to some extent exploitation of the locals doing business within the sector. There is need for the GMMA to work closely with the education sector especially at middle level colleges and University to develop curriculum that will ensure the sector has a critical mass of skilled manpower. Our polytechnics and Universities must capture this opportunity and develop training programs at both technologists and graduate level if the sector has to make its contribution to national development.

In conclusion, the issues of environmental management and social responsibility are critical for the mining sector and have to be given serious attention. Those who are entrusted with the management of these resources must ensure that they are accountable and transparent for the resources to benefit the locals, counties and the central Government. Kenya’s mining potential is huge and we need to lay the right policy and infrastructural frameworks for its full exploitation. The time is now.