Namibia: Venaani Wants Mining Royalties for Communities

Popular Democratic Movement president McHenry Venaani has proposed that between 2% and 5% of mining royalties could be channelled directly to communities living around mining operations through community trusts.

Venaani proposed this at a mining summit at Opuwo last week.

He said communities in mineral-rich areas should receive a lasting financial benefit from the resources extracted from their surroundings.

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"One of the things I think should happen . . . is to create community trusts so that we control the royalties in a configuration of the deals," Venaani said, addressing minister of industries, mines and energy Modestus Amutse.

Venaani said a portion of royalties generated by mining operations could be placed in community trusts to fund development and ensure that local residents directly benefit from mining.

He suggested the share could be between 2% and 5% of royalties.

"How do we make sure our people permanently benefit from our country's resources?" he asked.

Venaani also called on his fellow lawmakers to consider mechanisms that would increase the benefits flowing to communities in mining areas.

"Otherwise, only 20 Namibians can get mines, but the real money will not come to communities," he said.

Under Namibia's existing Minerals (Prospecting and Mining) Act, royalties are payable for the benefit of the state revenue fund.

Responding to Venaani, Amutse said mining royalties currently go to the state and contribute to the national budget.

He nevertheless indicated that mining licence conditions could potentially be used to secure additional benefits from investors.

"When we issue licences we normally issue them with conditions, now in these conditions we can definitely develop a component that would definitely speak to what we need to collect from certain investors depending on the nature of the licence," Amutse said.

He said the ministry was in the process of amending the Minerals Act of 1992, including provisions relating to concerns raised about the monitoring of mining activities and illegal mineral extraction.

SUPPORT

Kunene governor Vipuakuje Muharukua yesterday backed the idea of communities receiving a direct share of mining revenues.

Muharukua said Namibia could consider a dual royalty system under which both the state and communities benefit from mineral extraction.

"The money that will come from our mining is so much that we can support a dual system," he said.

He said the debate should extend beyond mining to other sectors where communities are expected to benefit from natural resources and investment.

Muharukua said communities involved in conservancies were not benefiting sufficiently from tourism, hunting concessions and other economic opportunities.

"How is it that our young people don't have lodges and concessions in those conservancies? How is it that our people cannot benefit more from the hunting concessions?" he asked.

He criticised corporate social responsibility initiatives that amount mainly to donations of items such as pencils and T-shirts or sponsorships of sporting events.

Muharukua said investors should be expected to leave communities economically stronger.

"What we need is this: leadership," he said.

Meanwhile, Kamanjab constituency councillor Nikodemus Hamutenya has raised concerns over what he describes as the illegal exploitation of minerals in the Kunene region.

Hamutenya says authorities face difficulties monitoring mining activities and determining the origin of minerals being transported out of the region.

He says police officers are often expected to deal with mining-related offences without specialised mining inspectors to assist them in identifying and tracing minerals.

"We don't have somebody to stop this. We have fishery inspectors and people from the agriculture ministry, but now we are giving the police the difficulty to see where these minerals are coming from," Hamutenya says.

He proposes deploying mining inspectors or commissioners at roadblocks to help authorities trace minerals being transported from mining areas.

According to Hamutenya, some suspected illegal mining operators abandon their machinery and flee when police arrive at mining sites.

Amutse yesterday said the ministry was preparing for the deployment of inspectors at different points, but that legal changes were first needed to strengthen the ministry's powers.

"As a ministry we have started preparing with the deployment of our inspectors at different points, but at the moment we are also restrained by certain legal provisions, because we have to first strengthen our legal systems to talk to what we want to implement," he said.