SADC MPs want value from region’s resources

AFRICA is the richest continent on earth in terms of extractive resources, but until parliaments up their game and demand meaningful deals, their citizens will continue to wallow in poverty.

Parliamentarians, who represent their countries on the SADC Parliamentary Forum’s Standing Committee on Food, Agriculture and Natural Resources, came to this conclusion during a virtual meeting last week.

South African lawmaker Tshitereke Baldwin Matibe chaired the meeting.

The continent is awash with massive deposits of extractive resources that include iron ore, petroleum and natural gas, crude oil, diamonds, gold, uranium, platinum, cobalt and phosphate.

The parliamentarians invited Titus Gwemende, Southern Africa Regional Lead on Natural Resources at Oxfam International, to share his thoughts on the impact of Covid-19 on natural resource governance in the SADC Region and what parliaments can do.

Gwemende argued that Covid-19 had not shown Africa anything new about natural resources but had “accentuated certain weaknesses and inequalities and accelerated certain processes that had already begun”.

He, however, said Covid-19 had triggered an “economic carnage” of national economies on the continent, with little prospect for economic growth on a scale needed to reduce poverty soon. Gwemende noted that the International Monetary Fund (IMF) had earmarked “negligible” amounts to emergency loans.

This, at a time when expenditure looks set to far exceed revenues, prompting many countries to run budget deficits.

He said the world was experiencing “massive economic contraction” and licensing for exploration and extraction in the oil and gas sectors was uncertain as Covid-19 rages. Additionally, the prices of most resources in the extractive sector had gone down, forcing many projects to drastically scale down or suspend production.

On the employment side, Gwemende said Covid-19-induced restrictions had resulted in loss of jobs for millions of people in the mining sector.

Underground mining operations had been uniquely hard hit because miners typically go down mine shafts in lifts, making social distancing a logistical nightmare.

The committee agreed on the need for national parliaments to deeply reflect on the ripple effects of Covid-19 on the ability of governments to sufficiently finance important sectors that include education, health and the civil service in which employees were already showing signs of anxiety.

Gwemende warned that when governments find themselves in a squeeze, the propensity to borrow, even on “punishing terms”, grows.

He said: “For MPs, this is the time to call for restructuring of loans and cancellation of some debts altogether.”

The committee agreed on the need for frank discussions on the future of employment in the mining sector post Covid-19 and for careful management of expectations. This is because many jobs lost during Covid-19 “may never come back” due to increasing automation or replacement of human beings with robots. On returns from mining, the parliamentarians expressed concern over exporting minerals in their raw form. It was noted that among the best roads in southern Africa were those linking mining sites to ports of export. This was meant to smoothen carrying of raw materials to where they are processed outside their countries of origin.

Gwemende suggested that parliamentarians must support initiatives to add value to minerals locally, manufacture mining equipment, set up refineries and produce chemicals used in mining. “Governments must support and improve the industrial base and allow local companies to capture larger parts of mining procurement while MPs advocate for local content inputs,” he said.

Turning to skills, he said lack of appropriately skilled manpower was the bane of the region’s extractive industry while poor prioritisation was another challenge.

“Our governments are busy resurfacing the wrong roads. Instead of creating new roads, we are resurfacing old colonial-era tarred roads.”

With gold being the only mineral fetching good money under Covid-I9, Gwemende enjoined MPs to help change the prevailing situation in which artisanal miners were regarded “as criminals”.

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Moses Magadza is a freelance journalist and a PhD student at the University of Namibia.