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EAC States begin review of Mining Bill, 2017

George Kebaso @gMorarak

The East African Community (EAC) is set to have an harmonised law guiding and coordinating mining activities in the region by May next year if a Bill currently under review is assented to by the region’s presidents.

A process to enrich the EAC Mining Bill, 2017 kicked off yesterday in the six member states. And once it becomes Law, it is expected to attract a new form of Foreign Direct Investment (FDI) in the region’s vast mineral potential.

Experts say that once the Bill becomes law, East Africans would enjoy a range of benefits from abolishment of Non-Tariff Barriers (NTBs) to easy movement of goods and services.

The law will initiate limitations to which foreign investors are going to exploit the region’s minerals at the expense of locals. The Bill has proposed a Sh75 billion ($750 million) for any foreign investor to acquire a mining permit, meaning no exploration and extraction agreement would be signed before this amount is deposited.

“It is critical that host countries are able to derive tangible benefits from the exploitation of their natural resources. The benefits should accrue to the local communities in form of appropriate royalties, taxes, dividends, business opportunities, professional jobs and employment for skilled labour,” local mining experts said.

University of Nairobi Department of Geology Chairman, Daniel Ichangi said there should be a clear benefit sharing mechanism to the country, commensurate with the amount of resources derived for the country.

In order to achieve this, taxes and other fiscal rates, environmental and social management in the country and by extension the region, should be comparable to those prevailing in advanced economies.

“This will encourage job creation despite the sector’s capital-intensive nature, by minimising environmental degradation and by allowing for the benefits to accrue even after depletion of resources,” he added during a public hearing session in Nairobi yesterday.

The EAC Mining Bill 2017, moved by Ugandan East African Legislative Assembly, (EALA) member last year, Chris Opoka-Okumu hopes to provide legal framework for the regulation of mining operations in the EAC.

It seeks to implement the EAC Vision 2050 and specifically to operationalise Article 114(2) (c ) (iv) of the EAC Treaty which calls for harmonisation of mining regulations to ensure environmentally friendly and sound mining practices.

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