- Africa continue to bleed billions in mining tax revenue- by Boitshepo Majube
Despite the significant growth in mining yield, tax revenue collected from mining multi-national companies operating in Africa have remained stagnant or less beneficial to the detriment of the African continent inhabitants. Few countries like Botswana have reaped the rewards from mining, while most countries have not.With the use of top accountants and lawyers, multi-national companies have been able to create company structures that allow them to avoid tax. They do so by creating by creating complicated overhead structures, that individual African countries cannot easily trace, and in process bleed billions of US dollars.
Statistics points out that Africa has lost more than 1 trillion American dollars to tax heavens or offshore centers in the process.
As Africa wakes up from its slumber, activists like Saviour Mwambwa are calling for "urgent renegotiation of mining contracts when they are not favorable."
Mwambwa also warned that until Africa has representation in tax regime negotiations, the situation would not improve. "Without African participation they would (Europeans, Chinese, Americans etc) agree on the tax regime that favours them, not Africa."
Lack of political will and lack of control over production in the mining sector are pointed out as key components fuelling the tax avoidance by multi-national companies. "Behaviour of rulers and key stakeholders needs to change in order for Africa to benefit."
Participants at the African Mining Vision, constituency building workshop also highlighted the injustice committed by multi-national companies, in order to avoid tax. They pointed out that that this companies employ their consultants paying them huge salaries, a move they say it's designed to avoid tax. "They sub contract their companies at exorbitant fees that benefits them, and defraud the masses by paying less tax," a delegate from DRC stated.
Participants also pointed out that African economic growth pioneered by mining sector has not translated into real jobs, rather has left more African inhabitants poorer.
Adjusted revenue figures presented at the conference, showed that Africa is only earning less than half of what it should be earning in real terms. The losses go as far back as the colonial era.
- Call for Mining to Improve People’s Livelihoods by Khutliso Sekoati
Delegates attending the Constituency Building Workshop on African Mining Vision have strongly observed that mining activities in the African continent should be geared towards improving the livelihoods of the people.
The two- day meeting held in Johannesburg from May2-3 which brought together labour unions, civil society organisations and media from the Southern Africa and the West African states, noted that there was a dire need for any mining activities in the region to benefit the people in which the exploitation of resources take place.
“Our mining sector has to talk to development. It has to improve the lives of the people through transforming them to better conditions than before the mining activities began,” clearly urged Dr Oliver Maponga, Economic Commission for Africa Sub-Regional Office for southern Africa based in Zambia.
He was deliberating on the African Mining Vision (AMV), a document adopted by the African Heads of State and Governments in February 2009 on providing guiding principles on the benefits of the mining sector in the continent.
The AMV is intended for development in such a way that people benefit from exploitation of the region’s minerals in Africa, he added while in addition observing the region has mineral resources in abundance while human development aspects are in poor state.
Dr Maponga suggested that despite the rich mineral resources available in the region social factors such as health and education as some of those still lagging behind.
The document advocates fro transparent, equitable and optimal exploitation of mineral resources to underpin a broad based sustainable growth and socio-economic development.
During the discussion, participants it emerged that monitoring and evaluation systems should be enforced as a score card to measure the progress in the realisation of the implementation of the tenets of the AMV and its Action Plan.
Such sentiments were also echoed by Dr Claude Kabemba, director of the Southern Africa Resource Watch, a non-governmental organisation advocating for people to benefit from the mining activities while meeting their needs.
He warned that while labour should understand that the struggle in mining is about wages that should translate into improving livelihoods.
In his address he highlighted that the concerns of the communities must be taken on board from the commencement of the mining project, saying the mining companies should take due regard of the needs of the communities in which they operate.
The AMV draws attention to mining projects not benefiting the communities in which the projects are being undertaken, said Dr Kabemba. He noted that most mining operations are far from fulfilling the promise of helping to reduce poverty.
He cited negative impacts such as pollution, land grabs, soil degradation, climate change and fewer job offers as factors that engulf the mining activities.
“Community issues intended for mitigation against negative impacts of the mining activities are left unattended. Governments seem to protect the mining companies to the extent of killing the people.
But he stressed the AMV was providing a key guidelines on beneficiation of the people, significantly pointing to a shift from just a private public partnership relationship but also to a people centred gains.