Miners lobby Uganda to lift ban on mineral export
Saturday July 25 2015
Local and foreign miners based in Uganda want the government to lift ban on export of unprocessed minerals to reduce the financial losses being currently incurred.
The Uganda Chamber of Mines and Petroleum (UCMP) is lobbying for lifting of the ban, which it says that has led to loses of jobs, downsizing of operations and closure of some firms as industry players cannot export unprocessed mineral ores.
The government has from February this year enforced a strict ban on export of iron ore, tungsten (wolfram), coltan, copper and phosphates insisting on value addition that will earn more money for Uganda.
“Make it a culture not to allow minerals to go out of this country unprocessed. We must educate our people to defend our economy. I do not want to be part of these historical mistakes,” said President Yoweri Museveni during the National Resistance Movement retreat in Kyankwanzi.
UCMP vice chairman, Richard Kaijuka said the omnibus ban is discouraging investment in exploration and created a credibility crisis that is scaring foreign investors.
“Currently many companies have obligations that they have failed to meet and some have closed shop while others have cut back on operations and staff. Lifting the ban will go a long way to reinvigorating the sector,” he said.
Investment in exploration of minerals in Africa dropped by 15 to 20 per cent from 2014 to 2015 due to decline in commodity prices. Kenya, Uganda, Tanzania and Rwanda are each competing for limited exploration capital.
Krone Uganda Ltd which is mining iron ore in Kabale, has bank loans but is not earning revenue. The firm is borrowing to pay workers and sustain the mine. Krone also has 80 tonnes of tungsten worth about $720,000 ready for export.
“If you cannot sell your products, then there is no point in doing exploration,’’ said Auranda Minerals director Jennifer Hinton.
UCMP said that iron ore cannot be processed fully into steel in the country as Uganda does not have coal required for coking. Therefore, to process, the country has to meet the cost of importing coal.
