Mutharika said 6 percent from mining

Mutharika said 6 percent from mining

LILONGWE (Malawi NewsNow) –The Annual Economic Report 2015, released by Ministry of Finance, Economic Planning and Development, indicates that mining and quarrying contributed 0.9 percent to gross domestic product (GDP)  in 2014 and that projections of the sector’s contribution to national output will remain below one percent for the next two years.

But President  Peter Mutharika told Parliament in May this year that mining is contributing 6 percent and that  government would continue to prioritise the sector “with a view to increase its contribution to the country’s GDP”   to about 20 percent by 2020.

A respected geologist and top mines technocrat Grain Malunga and  vice-president of the Geoscientists Association of Malawi (GAM), Ansel Zabula,  have said the mining sector contribution to the GDP would be lower than what the President presented in Parliament.

Chief economic adviser to the President, Collins Magalasi said the  figures in the President’s speech are “validated” but could not rule out typo.

The report recognised that the mining and quarrying sector estimated growth in 2013 tumbled from 14.9 percent in 2012 to 7.6 percent.

Reads the report in part: “This is mainly attributable to lower levels of uranium output in the second half of the year. Production at the Kayelekera Uranium Mine slowed in the second half of the year due to maintenance work on the plant and low prices of uranium at the international market.

“In 2014, the mining and quarrying sector is expected to contract by 7.8 percent. The expected contraction is attributed to the suspension of production at Kayelekera Uranium Mine as the company continued to make losses due to low prices on the international market.”

However, the report threw some rays of hope for 2015, saying the sector was expected to grow by 2.2 percent, owing to moderate growth in traditional mineral outputs, including rock quarry aggregate, agricultural lime, coal and gemstones.

The report indicated that it was possible that the actual attained level may be considerably higher if Paladin resumes production of uranium at Kayelekera or if significant investments are made in the sector following the conclusion of the geo-physical airborne survey.

The report shows that the trend has been dwindling since 2012 and 2013 when the sector contributed one percent to the GDP, in 2014 the sector contributed 0.9 percent and the sector is not expected to grow in 2015 and 2016 as it is projected to also contribute 0.9 percent in the next two years.