Case Study on the Development of Mining Vision in Lesotho

Communications Workshop31 may-2 June 2016

Lilongwe, MalawiMrs Asha Kannan,

Senior Economics AdvisorUNDP, Lesotho

Outline Role of the Mining sector

Process for design and implementation of CMV

The Process it Followed & Stakeholder Consultation

Principles of the CMV

Obstacles overcome and Lessons Learned

Key milestones and achievements

Launch of the Minerals and Mining Policy

Potential lessons learned for Malawi

Role of the Mining sector

Mining sector identified as key economic enabler in the National Strategic Development Plan 2012/13-2016/17

It contributes around 7.7 % to GDP ( objective to increase to 10% of GDP)

The sector employs around 3000 people It is a source of revenues for the Government Budget/ Fiscal sector.

Mining Sector’s Contribution to GDP

2005 2006 2007 2008 2009 2010 2011 2012 2013 20140.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

3.5%

4.3%

7.4%

8.5%

6.3%

5.8%

9.2%

6.6%7.0%

7.7%

Mining Sector Contribution to GDP

Mining Sector Policies in Lesotho

Mines and Minerals Act (2005); Mines and Minerals (Amendment) Act (2014); Mines Safety Act (1981); Precious Stones Order (1970); Precious Stones (Kimberly Process) Regulations (2003); Precious Stones (Diamonds Dealer’s Licence Grant and Renewals)

Regulations (2004); Explosives Proclamation of 1959

Key Milestones and Achievements

Lesotho signed the AMV in 2009

Mining Policy Training in 2011

Establishment of a full fledged Ministry of Mining 2012

Request for technical support from UNECA/UNDP in 2012

Agreed Programme design for Policy development –April 2013

Launch of the Government intention.

The Mining policy development process –July 2013 to July 2015

The Process Lesotho Followed & Stakeholder ConsultationsLaunch of the intention of Government (Task

Force)Scan of best practices

regionally and internationally

Local scan of current situation and literature

review

Presentation of Reports to the Task Force and Identification of

Key issues –Strategies that forms draft policy

Validation of the Green Paper by Task Force

Summary of Green Paper

and Translation

Public, District & Community

Consultations

Consolidation of White Paper and

its validation

Completion of the draft policy and presentation to

Cabinet

Consultation of the Parl.

NR Committee

The Process Followed & Stakeholder Consultation

Wide and participatory multi-stakeholder engagement to create a common understanding, interest and commitment to the CMV process.

The CMV analytical process for the Lesotho mineral policy formulation exercise used the STEEP Process (a diagnostic tool for building consensus and prioritization). The STEEP process evaluates each issue based on the following diagnosis which considers: social issues (S), technological issues (T), economic issues (E), environmental issues (E) and the policy environment pertinent to the sector (P).

An Inter-Ministerial Taskforce ( all relevant Ministries, mining industry players and NGOs formed part of it) on the policy making process established .

The multi-stakeholder group participated in the STEEP process which developed inputs into the Green paper and validated the White paper.

Vision of the Minerals and Mining Policy (MMP-Lesotho’s CMV)

Vision : “To provide for responsible and globally competitive

exploitation of the country’s mineral resources in a manner that

results in sustainable socio-economic benefits to the country.”

Principles of the CMV Embodies principles of transparency, equitable distribution

and responsible mining Sovereignty and ownership of mineral resources to vest in the

Basotho Nation. Transparency and accountability in all aspects of administering

and managing the country’s mining sector. Equitable, optimal and sustainable exploitation of the country’s

mineral resources. Upholding Human Rights, Gender equality, Environmental

sustainability, safety and occupational health standards. Domestic empowerment and integration of the Basotho Nation. Participatory and inclusive approach.

Key challenges addressed by the MMP

Insufficient knowledge of Lesotho’s mineral resources, Gaps in principal mining legislation and its limited scope, Absence of socio-economic development goals, Update mineral sector governance standards, Cover mining fiscal and taxation issues, Address the lack of clear GOL policy on artisanal and small-scale

mining (ASM), value-addition, domestic empowerment, CSR guidelines and safety and occupational health standards.

Attain economic diversification through infrastructure development and planned connectivity of mining sector to other economic sectors such as agriculture, value-adding processing, tourism, etc

Objectives of the Government for the Mining Sector

To ensure that the mineral wealth contributes to the national economic and social development.

To mitigate the adverse social and environmental impacts of mineral development.

To ensure equitable access, transparency and public participation in the sustainable development of the mining sector.

To stimulate investment in the mining sector.

Obstacles overcome and Lessons Learned Political Commitment

Multi -Stakeholders Consultations/Coordination

Managing expectations

Building Capacity- Ministry, NGO, Stakeholders

Ownership of Policy

Lessons Learned The importance of creating awareness Inclusiveness for developing policies achieves good results Collaboration of 2 agencies: UNDP and UNECA Government ownership and alignment with national policies

Future priorities and challenges

Capacity building for the Ministry of Mining Need for increasing limited financial resources and technical

expertise, of the Ministry for: Reforming the taxation regimes (to tax mining companies fairly). Support multi-stakeholder consultations in mining sector

development . Support investment promotion in the mining sector.

Way forward

Following the approval of the policy by GOL, the following steps were presented, discussed and agreed in the stakeholder Meeting in July 2015:

Plan to Launch Development of Implementation Strategy (road map and time frame)

Review and development of a revised Legal and Regulatory Framework

Review of and implementation of Institutional Reforms

Policy Dissemination

Thank You

Kea Leboha