Mining & Trade News

As reported in our main article, government is finalising formulation of regulations for raw mineral export ban declared by State President Arthur Peter Mutharika soon after taking over power in last year’s elections.

It is unfortunate that it has taken long to develop the regulations leaving the sector chaotic but we commend government for moving with speed after stakeholders  raised concerns about the impacts of the ban on the sector.

We have published articles about exploration firms failing to export mere samples for their scientific studies because of the ban with security officers or authorising personnel applying their own understanding of the ban to bar the exports due to lack of supporting regulations.

We have written about small-scale miners failing to export their gemstones for processing outside the country due to the ban despite that the country lacks facilities for gemstone processing.

The situation has not only led to declining income and increased hardships for small scale miners but also a drop in mining revenue for the Malawi Government as reported in the latest annual economic report published by the Ministry of Finance and Economic Affairs.

We believe the coming of the long-awaited regulations will be a remedy. 

Equally, as reported in the article, we believe the regulations will deal with uncertainty on the export of the Kangankunde Rare Earth monazite concentrate. In scandalous circumstances, the Mining and Minerals Regulatory Authority (MMRA) issued two contradicting letters. In one letter, the MMRA rejected Lindian to export the concentrate owing to the ban while the other gave consent to the company with the signatory former Director General of MMRA Samuel Sakhuta claiming that converting monazite ore to monazite concentrate is full-scale processing possible in Malawi in accordance with the ban.

Certainly, the regulations will tell us what the ban means on processing of rare earth ore. Is production of monazite concentrate full-scale beneficiation accepted by Malawi Government as reported in the letter that Lindian presented to Australian Stock Exchange or is processing to rare earth oxides full-scale processing, according to the thresholds of the ban?

CONGRATULATIONS HONOURABLE THOKO TEMBO
On a different note, we join stakeholders in congratulating Honourable Thoko Tembo for being sworn in as Minister of Mining following his appointment several weeks ago. We wish you all the best Honourable in this signifiant role for Malawi’s economic revival!!!

The 
Kangankunde case:  
A missed 
opportunity for Malawis’ Rare Earths.

News that Lindian Resources, a mid-tier company mining rare earth in Malawi at Kangankunde hill, has entered into strengthening its trade, marketing and logistics in Singapore soon after first blast gives an insight into how mining companies operate having an advantage over a mineral host country to their advantage. Singapore is not a traditional, classic tax   haven like the Cayman Island, Bermuda which include secrecy, minimal taxation and lack of economic substance. It is   classified as a tax haven because of its high, competitive tax regime, zero capital gains and other incentives that ultimately lower effective corporate taxes for foreign investors although it claims that it is legally compliant, transparent in its dealings and internationally recognized. This type of open tax policy and locality makes it a gateway for mining companies wanting to expand into emerging multinationals rendering Singapore a global hub for international investment and trade.
 

Possible reasons why Lindian chose Singapore

• Singapore is a centre for international
  trade and finance.
• Favorable policies for people living and
  doing business.
• It offers several tax breaks, relatively low
  corporate tax rate and top personal tax
  bracket and there is no any levy/tax on
  capital gains. 
• Its’ territorial tax system allows certain
   foreign-sourced income to be exempted
   under specific conditions
• Qualifying companies may receive 
   partial exemptions on a certain amount 
   of  chargeable income,

Unlike traditional tax havens, Singapore requires companies to demonstrate real economic activity, such as hiring local employees and maintaining local operations, to qualify for tax incentives. This ensures that businesses are not merely briefcase companies and contributes to the country’s reputation as a legitimate financial hub. Such incentives have also attracted global multinationals who use Singapore for regional headquarters and strategic tax planning.
 

What does this mean for Malawi as a mineral host country?

Critically, Malawi will somehow be disadvantaged in the following ways:

1. Base erosion and profit shifting (BEPS).
This is a situation where a mining company exercises tax avoidance strategies to exploit gaps in tax rules to artificially shift profits to low or no-tax location. This risks transfer pricing where Lindian may undervalue its rare earth export of concentrate and sell cheaply to its own Singapore marketing hub, effectively trapping the largest profits in a low-tax jurisdiction and leaving the host country (Malawi) with minimal taxable corporate income. This may shift the profits realized from Malawi as an extraction site to Singapore. Besides, the country has probably already been deprived of its taxes, royalties and other community benefits after being allowed as a Mid-tier miner (medium scale mining). Furthermore, the host nation (Malawi) also bears all environmental and social costs.

2. Tax Incentive Asymmetry

Generally, when a country trades with a tax haven, it avoids high/standard corporate tax rates in a host country opting for these countries that offer specific incentives in form of schemes thereby reducing the tax rates on trading income. There is an inherent tax gap where a company (Lindian) will maximize its profits in Singapore.
 

3. Information and Asymmetry 
Obscurity
Singapore has physical trading with complex financial institutions and has capacity for hedging (a risk management strategy used in finance and business to offset the risk of adverse price movements in an asset) than in Malawi. In another aspect, Malawi as a host country, tax authorities lack the data or capacity to audit these complex offshore transactions and with creation of hidden margins, the true commercial profit margins remain obscured.
 

Proposed solutions for Malawi to do 
better (win-win situation)

a). Review and Reduce Tax Incentives
Host countries often lose revenues from overly generous tax holidays and accelerated depreciation. An example is the Kayelekera Uranium Mine which was mining uranium under Paladin Energy and was given a 10 year tax holiday where price downturn forced the mine to be under Care and Maintenance just after operating for 5 years. Malawi must balance these incentives with primary infrastructure investments to support domestic value addition. It is unfortunate that while the agreement showed that Lindian would be exporting rare earth oxide, the mining sector has learnt that the company is exporting monazite concentrate according to some documentation released to the public

(b). Direct State Participation
Host governments secure a direct share of revenues and mitigate tax-avoidance risks through equity stakes and direct licensing. Through MAMICO (Malawi Mining Investment Company), the government must brace itself for the upcoming   mining companies to get involved in equity sharing and  also with time, localize the mines.
 

c)Mandatory Disclosure Rules
Mining companies are obliged to submit standardized data on production, subcontracting, procurement, local content and offshore transactions in alignment with mining frameworks. Malawi must make sure that these frameworks are adhered to and embraced as mandatory.

(d). Joint Mandate Traceability, 
Monitoring and Data Exchange
Malawi must intensify inter-government collaboration) and non-state actors in monitoring, tracking and verification of mineral exports, point of sale, imports for use by the mining company. The Ministry of Mining including its’ Departments, Mining and Minerals Regulatory Authority (MMRA), Malawi Revenue Authority (MRA) while the non-state actors like MWEITI, Natural Resource Justice Network (NRJN) have to check on accountability and transparency in exercise of this collaboration.

(e). Implement the Sixth Method
 Some countries like Zambia implemented mandatory use of publicly quoted commodity market values as a benchmark like from London Metal Exchange based on shipping date/loading for related-party mineral sales to prevent deliberate underpricing. This is a transfer-pricing rule used to prevent multinational mining companies from artificially reducing taxable profits by selling minerals to offshore, related-party marketing hubs at undervalued prices where it is called the Sixth Method. Malawi must adopt the same because these mining companies avoid internal pricing formulas to run away from taxes.
 

A cloud of uncertainty is hovering over ASX-listed junior Lindian Resources’ plans to start commercial exportation of monazite concentrate from its Kangankunde Mine in Balaka to its refinery in Kazakhstan in November this year as government is finalising regulations that defines thresholds to which all minerals must be processed before leaving Malawi.

The regulations form part of the Executive Order banning exportation of raw minerals that was issued by State President Arthur Peter Mutharika after coming to power in last year’s general elections.

A well-placed source at the Ministry of Mining told Mining & Trade Review that the regulations include a clause that rare earth bearing ore including monazite that Lindian is mining at Kangankunde  must be processed to rare earth oxides before exportation. 

The source, who opted for anonymity, confided with Mining & Trade Review that the regulations are now drafted and what remains is vetting by the Ministry of Justice and the Attorney General’s office.

He explained that the regulations were initially sent to the Ministry of Justice where some areas were identified for improvement and the Ministry has finalised the necessary ratifications and is about to send a final copy to the Ministry of Justice and Attorney General’s office for vetting.

He said: “The Ministry looked at how Malawi can maximise its potential gains from critical minerals such as rare earths, rutile, graphite, niobium, uranium and tantalum. We did not leave anything to chance when looking at value addition for these minerals. I, therefore, confirm that there will be no exemption, rare earth ore from Kangankunde will have to be processed into rare earth oxides before leaving Malawi.”

“This is in accordance with the Presidential Order that seeks to see that Malawi does not miss out on benefits from its critical minerals in several areas including creation of employment and business opportunities through mining as an enabler of Malawi 2063, which is rooted in industrialisation to graduate Malawi into middle income status.”

The source told Mining & Trade Review that chances are high that the regulations will be in force before November this year putting plans of Lindian targeting the same month to start commercial exports to its newly acquired refinery in Kazakhstan in jeopardy.

The Australian junior, which is seeking to grow into mining by controversially using a medium scale mining licence to operate Malawi’s world class Kangankunde monazite deposit, was authorised to export monazite concentrate by former Mining and Minerals Regulatory Authority (MMRA) Director General Samuel Sakhuta in scandalous circumstances. Mining & Trade Review uncovered two letters dated October 28, 2025 signed by Sakhuta with one authorising and the other rejecting Lindian to ship the concentrate out of impoverished Malawi due to the Presidential ban.  

Lindian the following day published a Press Statement on the Australian Stock Exchange announcing that Malawi Government had authorised it to export monazite from Kangankunde . The positive announcement culminated into the junior miner signing multimillion-dollar offtake agreements with foreign refiners and raising over a US$100-million to finance its operations at Kangankunde and the Kazakhstan refinery.

The Anti-Corruption Bureau (ACB) has, meanwhile, said is reviewing reports of suspicious correspondence between Sakhuta and Rift Valley Resources Developments operating as Lindian Resources.

“The Bureau will treat it with the urgency it deserves,” said ACB Acting Director General Gabriel Chembezi.

Minister of Mining Honourable Thoko Tembo said his Ministry is waiting to receive comprehensive briefings from relevant technical and regulatory authorities before commenting on the alleged irregularities in the development of Kangankunde Rare Earth Mine.

Tembo said: “I will refrain from commenting on operational details of the Kangankunde Project until I have received comprehensive briefings from the relevant technical and regulatory authorities.”

“Once that process is complete, the Government will communicate its position where appropriate.”

“Our objective is to ensure that Malawi’s mineral resources are developed responsibly, transparently and in a manner that delivers maximum benefits to our citizens.”

Chairperson of the Parliamentary Committee on Natural Resources and Climate Change Tione Hendrie has, mewnwhile, hailed Mining & Trade Review for updating Malawians on the developments at the Kangankunde Rare Earth Mining Project and other projects across Malawi.

Hendrie said in an interview at Parliament that Malawians deserve to be updated on the project as Kangankunde is a globally significant deposit and one of the world’s largest with rare earths classified among the critical minerals by global economic superpowers including the United States and the European Union.

Kangankunde is also set to become the first ever rare earth producing mine in Malawi. 
“We commend you for bringing developments on this mine to light. As a committee, we will sit down and plan to visit Lindian and tour the mine and also discuss with the Ministry of Mining and MMRA,” Hendtrie said.

She stressed that the Committee wants to ensure that the mine is meeting the demands of its licence and the Executive Order banning raw mineral exports.

Meanwhile, sources at the Ministry have revealed that the new regulations have included clauses to enable Artisanal and Small-scale Miners (ASMs) have relief in the exportation of raw minerals for processing while the government pursues plants to establish mineral value addition sites across Malawi.

The development follows an outcry from ASMs who have been hit hard by the mineral export ban as Malawi lacks processing sites for precious minerals such as gold and gemstones.

The Ministry of Mining is also reviewing the Mines and Minerals Act 2023 to ensure that attributes of the ban are reflected in the new Act.

Lindian Resources launched its first blast officially marking the start of mining earlier this month at a ceremony that was attended by a number of government officials.

Ironically, the Company appointed Sakhuta’s former immediate boss while at MMRA Martin Kaluluma Phiri, who was Principal Secretary (Regulations) in the Ministry of Mining as Country Manager taking over from Seasoned Engineer Trevor Hiwa who held the post after Geologist Chrispin Ngwena who served as the first Country Manager for the company in Malawi. 
 

Malawi's Minister of Mining, Honourable Thoko Tembo, together with the Principal Secretary and a delegation of senior Ministry officials, recently visited Sovereign Services' laboratory and Kasiya Trial Mining and Rehabilitation Site to receive an overview of the Kasiya Rutile-Graphite Project and review progress since completion of the Definitive Feasibility Study (DFS).

The visit provided an opportunity for the delegation to gain first-hand insight into the technical, environmental, social and economic work undertaken during the DFS, and to discuss the Project's potential contribution to Malawi's long-term development.

During presentations and site inspections, the delegation reviewed the scale of technical studies completed, the Company's environmental management approach, rehabilitation trial, early community development programs and agricultural initiatives designed as proof of concept of sustainable livelihoods alongside future mining activities.

Discussions also explored the broader opportunities the Project could create for Malawi, including employment and skills development, growth of local businesses through procurement, agricultural productivity programs, community development initiatives, foreign exchange earnings and potential downstream industrial development.

The delegation toured Sovereign Services' laboratory, where they were introduced to the scientific capability supporting the Project, before visiting the rehabilitation trial site to observe the Company's approach to progressive rehabilitation and post-mining land restoration.

Particular interest was shown in the integrated agricultural development strategy, including conservation farming initiatives that aim to improve agricultural productivity while creating lasting benefits for farming households within the Project area.

Minister Tembo noted the importance of responsible mine development that balances economic opportunity with sound environmental management and long-term benefits for Malawians.

"One of the things that government worries about is legacy mines. When people are done with their mining, they move on and leave a lot of pits everywhere, and these are usually an environmental hazard. So, to see that Sovereign Services has a plan for what they are going to do afterwards is something that is comforting to government."

Sovereign Services Country Manager Maxwell Kazako thanked the Minister and delegation for visiting the Project and reaffirmed the Company's commitment to responsible project development.

"We appreciate the opportunity to demonstrate the work that has been undertaken since 2019 and to showcase the breadth of studies completed through the Definitive Feasibility Study. Our objective is to develop the Project responsibly, working closely with Government, local communities and other stakeholders to deliver lasting benefits for Malawi."

The visit concluded with constructive discussions on the Project's progress and the opportunities it presents through responsible development, environmental stewardship and long-term investment in people, communities and the Malawian economy.

The federation of Artisanal and Small-Scale Mining in Malawi (FASMIM) has welcomed Malawi Government’s decision to draft minerals processing and value addition regulations saying it will empower locals and create conducive environment for the subsector.

The Ministry of Mining is finalising Value Addition Regulations which aim at promoting local mineral beneficiation and processing in line with Presidential Executive Order, which prohibits the export of raw minerals from Malawi.

FASMIM President Percy Maleta said in an interview the regulations will significantly benefit the sector if they are practical, clear, predictable and align with industry realities.

He said: “We fully support the objective of increasing local beneficiation, creating jobs, attracting investment and ensuring Malawi derives greater value from its mineral resources.”

“However, the realities of the ASM subsector must be considered. Since the prohibition of raw mineral exports, miners, dealers and exporters have faced significant uncertainty regarding what constitutes acceptable processing and value addition.”

“The lack of clear guidelines has affected market access, tied up working capital, disrupted businesses and negatively impacted miner livelihoods.”

Maleta said there is a need for the regulations to clearly define value addition for different minerals, recognize that value addition begins immediately after extraction, and provide a gradual pathway for compliance based on the capacity of operators.

He said: “For gemstones, activities such as cleaning, sorting, grading, certification, cutting, faceting, polishing and jewelry manufacturing should all be recognised as legitimate forms of value addition.”

“We recommend clear and simple regulations; mineral-specific guidelines; recognition of different levels of value addition; support through training, finance, equipment and technology; continued stakeholder consultation; reasonable compliance requirements and; incentives that encourage investment in processing and beneficiation.”

But Maleta said it would have helped if the regulations were operationalized much earlier saying the sector has endured more than a year of uncertainty due to the delays in formulating them

“Nevertheless, it is better to establish a workable framework now than to continue operating without clarity. FASMIM remains committed to working with Government and all stakeholders to ensure the final regulations promote compliance, investment, growth and sustainable development within Malawi's mining sector,” he said. 

When a mining company arrives in a rural community, the promise is often simple; jobs, schools, roads, and prosperity. The reality, as documented across thirty-two countries with community development provisions in their mining codes, is far more complex. The instruments designed to deliver these benefits, thus the Community Development Agreements |(CDAs), have evolved into a bewildering array of models, each with distinct advantages, profound limitations, and very different implications for the communities they are meant to serve.

The global mining industry has moved decisively beyond the era when corporate social responsibility meant writing cheques to local charities or building the occasional school. Today, CDAs are sophisticated legal instruments that can determine whether a community benefits from resource extraction or is left impoverished when the mine closes. Yet despite decades of experience, the evidence suggests that success remains elusive: legal provisions on paper rarely guarantee implementation on the ground, and communities continue to struggle against agreements that promise much but deliver little.

At their simplest, CDAs come in six principal forms, thus:

1.  the Benefit-Sharing Model, where communities receive a percentage of revenues or profits;

2.  the Shareholding Model, where they become partial owners of the mining operation;

3.  the Community Trust Model, which establishes legal entities to manage funds on behalf of communities;

4.  the Foundation Model, similar to trusts but operating under corporate law;

5.  the Direct Expenditure Model, where companies provide infrastructure and services directly; and

6.  the Hybrid Model, which combines elements of all the others.

The Benefit-Sharing Model, also known as the revenue-sharing model, appears straightforward. Sierra Leone's Mines and Minerals Development Act 2022 requires large-scale mining license holders to contribute 0.25 percent of the ex-mine price of minerals sold annually to primary host communities, just as the Malawian model.

The model's appeal lies in its predictability and transparency. When payments are calculated based on objective metrics such as production volume or revenue, communities can anticipate funding flows and plan development activities accordingly. The formula-driven approach reduces negotiation costs and conflicts, while creating automatic alignment of interests: when community benefits increase with production, communities have economic incentives to support mine operations rather than oppose them.

Yet the limitations are equally compelling. Mineral prices fluctuate dramatically based on global market conditions, creating boom-bust cycles in community funding. When commodity prices collapse, communities dependent on benefit-sharing payments face sudden budget shortfalls, disrupting development projects and creating dependency rather than sustainable growth. The Model Mining Development Agreement guidance warns that managing government revenue stability during price fluctuations requires capacity building before revenues arrive, a requirement rarely met in practice. Weak enforcement mechanisms plague these agreements in many countries where there are legal provisions but no regulations or guidelines.

The Shareholding Model represents a fundamental shift from beneficiary to owner. Under this arrangement, host communities receive direct ownership stakes in mining operations, entitling them to dividends and capital appreciation like any shareholder. The transformative potential is undeniable. When communities become owners rather than beneficiaries, the relationship with mining companies shifts from transactional to partnership-based. Communities have legal rights to information, participation in shareholder decisions, and a share of enterprise value appreciation over time. Equity ownership typically carries voting rights and board representation, giving communities formal channels to influence decisions affecting their welfare. The model illustrates how equity can translate into genuine governance participation rather than passive benefit receipt. But the challenges are substantial. Community equity stakes are typically purchased through loans that must be repaid from dividends before any funds become available for development projects. In South Africa's renewable energy programme, which has influenced mining sector thinking about community equity participation, one can note that there are long delays in funds becoming available because of the need to repay loans for the equity. Communities may wait years before seeing any tangible benefits from their ownership stakes. Effective equity ownership also requires understanding of financial statements, corporate governance, valuation, and investment strategy capabilities rarely present in mining-affected communities without extensive capacity-building investments. Without these capabilities, community board representatives may be outmatched by sophisticated corporate counterparts.

The Community Trust Model attempts to address these governance challenges by establishing legally constituted trusts that receive mining revenues and manage their distribution for community benefit. Trusts are distinct legal entities with fiduciary duties to beneficiaries, governed by trustees who may be appointed by companies, communities, government, or some combination. South Africa has the most extensive experience with this model, but the results have been sobering: in the decades since the Mineral and Petroleum Resources Development Act of 2002 required mining companies to set aside revenue percentages for community development, there are few examples of a truly successful model.

The problems are systemic. Trusts have been plagued by conflicts over trustee positions, disagreements over fund spending, and community perceptions of failed consultation. Community members fight for the scarce roles of community trustees; company and community members do not agree on how funds are spent; communities feel aggrieved at the lack of consultation and, ultimately, what they perceive to be the failure of trusts to deliver tangible, sustainable and positive impacts on their lives. Trustee positions create patronage opportunities, and competition for appointments can divide communities. Trust management requires legal, financial, and project management capabilities rarely present in mining-affected communities. Companies viewing trusts as a necessary frustration and tick-box exercise produce failed trusts.

The timing of trust establishment compounds these problems. In South Africa's renewable energy programme, trust deeds must be submitted before the financial close of the project, which does not allow for community consultation. By the time communities learn about trusts, many important decisions have been made on their structure, management and purpose, forcing communities to make the trust work regardless of any gaps. Financial limitations further constrain impact, particularly in early years. Dividend payments from equity stakes may be modest, and loan repayment obligations consume available funds before any reach beneficiaries.

The Foundation Model, similar to trusts but operating under corporate rather than trust law, offers some advantages. Foundations have legal personality separate from both trustees and beneficiaries, can employ staff directly, enter contracts, and own assets in their own name. This makes operational activities easier; foundations can open bank accounts, employ staff, enter service contracts, and own property, activities difficult for unincorporated community groups or informal trusts. Charitable tax status in many jurisdictions offers financial benefits, as donations to registered foundations may be tax-deductible for mining companies.

Yet foundations face their own challenges. Governance distance between foundations and communities creates accountability challenges; foundation boards may become disconnected from beneficiary communities, pursuing priorities reflecting director preferences rather than community needs. The regulatory burden is substantial, with registration requirements, ongoing reporting obligations, and oversight that may exceed community capacity. Startup costs are significant, as legal fees for incorporation, registration with regulatory authorities, and establishment of financial systems may consume resources needed for community benefit.

The Direct Expenditure Model takes a different approach entirely. Rather than providing funds for communities to manage, companies directly provide benefits: building roads, schools, clinics, and water systems; providing training and employment; or delivering services including healthcare and education. A mine agreement here requires the investor to make its self-discovered water resources available for household purposes, herder families and agricultural activities, and to support the government in establishing safe drinking water for the local community.  

Implementation speed is a primary advantage; companies have project management capabilities and resources that communities lack, enabling rapid infrastructure delivery. Quality assurance is enhanced through company control, ensuring infrastructure meets professional standards. Employment creation provides immediate community benefit, putting cash directly into community members' pockets and supporting social license to operate.

But paternalism remains the central critique. Direct expenditure models position companies as benefactors and communities as passive recipients, undermining community agency and perpetuating dependency relationships. Misalignment with community priorities is common; companies may provide infrastructure reflecting their priorities rather than community needs. A clinic is valuable, but a community prioritizing education may resent company allocation of resources to healthcare. Maintenance liabilities are often overlooked; companies build infrastructure but rarely fund ongoing maintenance, leaving communities with facilities they cannot sustain. School buildings without teacher salaries, clinics without medical supplies, and roads without repair budgets represent failed benefits. Sustainability concerns arise when mine closure ends direct expenditures, leaving communities with no ongoing benefit stream.

The Hybrid or Blended Model, increasingly recognized as global best practice, combines elements of multiple CDA types. These agreements typically include revenue-sharing or equity provisions creating ongoing funding streams, trust or foundation structures to fund governance, direct expenditure commitments for specific infrastructure or services, and local content requirements for employment and procurement.

Diversification of risk is the primary advantage. When communities benefit through multiple channels including equity, royalties, employment, infrastructure the failure of any single channel does not eliminate all benefits. Price volatility affecting royalties may not affect employment, and mine closure ending both may leave community-owned infrastructure as lasting legacy. Addressing multiple time horizons represents a second advantage; direct expenditures provide immediate benefits, revenue-sharing provides medium-term funding, and equity provides long-term value creation. Multiple accountability mechanisms enhance governance; when communities have equity voice, trust oversight, and employment relationships with companies, they have multiple channels for raising concerns and enforcing commitments.

Yet complexity is the hybrid model's central challenge. Negotiating agreements with multiple components requires legal, financial, and technical expertise that communities lack. Companies may exploit complexity to obscure unfavorable terms or evade commitments. Coordination requirements across multiple governance structures create administrative burdens that demand organizational capacity rarely present.

Globally, evidence from countries with CDA provisions reveals that no single model is universally superior. Model selection must consider community capacity, legal frameworks, mineral economics, and governance quality. High-capacity communities with legal, financial, and project management skills can manage complex trust or equity arrangements. Low-capacity communities may require simpler benefit-sharing or direct expenditure models with technical assistance provisions. Some countries mandate specific models through mining laws; others permit negotiated flexibility. High-value, long-life mines support equity and trust models requiring patient capital, while low-value, short-life mines may only sustain direct expenditures or modest benefit-sharing.

Emerging practice are that effective CDAs share common features regardless of model; thus including community consultation preceding agreement design; transparent financial management with independent audit; balanced governance giving communities genuine voice; dispute resolution mechanisms accessible to community members; capacity-building to enable community participation; and post-mining transition provisions for sustainability and economic diversification support. Countries like Sierra Leon, Ghana and Liberia have demonstrated that properly designed CDAs can deliver substantial community benefits. But implementation failures in most countries with CDA provisions reveal that legal mandates alone are insufficient. Political will, regulatory capacity, community mobilization, and sustained corporate commitment are equally essential.

The lesson is clear for Malawi, there is no silver bullet in community development agreements. The most sophisticated legal instrument produces no benefit if communities lack voice in its governance or capacity to enforce its provisions. As the global mining industry continues to evolve, the challenge lies not in designing perfect models but in building the institutional capacity, political will, and genuine partnership that make any model work. A good CDA should always have a structure, processes and institutions that are going to implement it. The success or failure of CDAs ultimately depends not on their form but on their implementation and that remains the industry's unfinished business.

Located in Balaka off the M1 road junction close to Senzani Trading Centre, Kangankunde mine is expected to open in November this year to become Malawi’s first rare earth mine. This appears like an economic milestone that Malawians were supposed to be celebrating. But the reality on the ground is different with business leaders painting a good picture of the project while a cross section of Malawians appear not convinced that the project will bring expected economic returns to locals.

Topical issues include that Australian-listed Lindian Resources is operating as a local company Rift Valley Resource Developments using a medium scale mining licence to run the globally significant project. This type of licence legally does not mandate the Company to sign a Mine Development Agreement that includes an equity sharing agreement with the Malawi Government and a Community Development Agreement with the local community.

Lindian is planning to launch commercial export of monazite concentrate to Kazakhstan for downstream processing in November this year, which is also sparking questions from Malawians on the project failing to meet the nation’s local value addition ambitions highlighted in Malawi 2063. I captured contrasting views from two commentators. Excerpts:

Michael Aldworth, CEO Farming & Engineering Services

Morning Marcel

I have followed with interest the recent series of articles published by Mining & Trade Review concerning the Kangankunde Rare Earth Project and the broader debate around how Malawi should benefit from its mineral resources.

Firstly, I would like to commend Mining & Trade Review for stimulating what is clearly an important national conversation.

The questions being raised around licensing, government participation, community benefits and value addition are legitimate issues that deserve public scrutiny and discussion.

However, I wonder whether there is an equally important aspect of the debate that has perhaps not received the same level of attention.

Many commentators have rightly argued that Malawi should not simply export raw minerals and should instead pursue greater local processing and beneficiation. As a principle, I believe most Malawians would agree with this objective. The question, however, is not whether we would like to see more processing take place in Malawi, but rather what conditions are required to make such processing commercially viable.

Rare earth processing is not a simple extension of mining. It requires reliable electricity, significant water resources, advanced chemical processing capability, specialist technical skills, environmental management systems and substantial supporting infrastructure. These are not obstacles unique to Malawi, but they are realities that every developing country seeking industrialisation must confront.

Perhaps the more important national discussion is therefore not whether companies should be encouraged to process minerals locally, but what Malawi must do to become a location where such investment naturally makes economic sense.

If Malawians wish to see processing plants, refineries, manufacturing facilities and higher-value industries established within our borders, then we must also ask difficult questions about energy security, transport infrastructure, industrial policy, foreign exchange availability, regulatory certainty and investment attractiveness.

As someone who has worked in Malawi for many years, I firmly believe the country possesses enormous potential. We have fertile land, mineral resources, a strategic location and a resilient population. What we need now is a national conversation that focuses not only on what investors should do for Malawi, but also on what Malawi must do to attract and retain the scale of investment required to transform the economy.

The Kangankunde project should therefore be viewed not only as a mining project, but also as an opportunity to have a broader discussion about industrialisation, infrastructure development and economic growth.

Ultimately, the goal should be the same for all stakeholders: ensuring that Malawi receives maximum long-term benefit from its natural resources while remaining a destination where investors have the confidence to commit capital, create jobs and contribute to national development.

Ronald Banda, Our Facebook follower

Open dialogue is important, particularly for a project of such national significance. However, several issues remain insufficiently addressed and continue to warrant legitimate public scrutiny.

Firstly, while Lindian argues that it is legally operating under a medium-scale mining licence because it does not yet meet the thresholds for a large-scale licence, many Malawians find it difficult to reconcile this position with repeated reports indicating that Kangankunde contains one of the world's most significant rare earth deposits. If the resource potential is indeed as substantial as has been presented to investors and international markets, then it is reasonable for citizens to ask what the long-term operational plan is and when the project is expected to transition from medium-scale operations to large-scale mining. Transparency on this matter would help build public confidence.

Secondly, Lindian's response does not adequately address the question of future ownership and participation by Malawians. Mining projects of strategic national importance should not only generate royalties and taxes but should also create pathways for meaningful local equity participation, whether through Government shareholding, pension funds, local institutions, or eventual listing on the Malawi Stock Exchange. The public deserves clarity on whether such opportunities are being considered and, if so, under what timeline.

Thirdly, while Lindian correctly points to infrastructure challenges relating to power, water, and industrial processing, the Company should adopt a more proactive approach. Historically, successful mining companies across the world have not merely adapted to existing infrastructure limitations; they have actively partnered with governments and development partners to develop the infrastructure necessary for long-term industrial growth. If roads can be constructed to support mining operations, then discussions around power generation, transmission, water systems, and industrial processing facilities should also form part of a broader development strategy for the region.

On downstream processing, the technical arguments advanced by Lindian may be valid in the short term. However, Malawians are justified in asking for a clear roadmap showing how value addition will progressively increase within Malawi. Exporting concentrate today may be commercially necessary, but what matters is the long-term vision. Citizens would like to see a phased plan demonstrating how processing capacity, skills transfer, technology transfer, and local industrial participation will be developed over time, with the ultimate goal of retaining a greater proportion of value within Malawi. A target of achieving significant local value addition in the medium to long term would be a positive commitment.

It is also important to address the suggestion that questioning aspects of the project could discourage investment. Such arguments should be approached with caution. Investors are not frightened by informed public debate; they are attracted by transparency, stability, good governance, and predictable regulatory environments. Citizens asking questions about their country's natural resources should not be made to feel guilty or portrayed as obstacles to investment. Africa's history contains numerous examples where natural resources generated enormous wealth but delivered limited benefits to local populations. It is therefore understandable that Malawians are taking a keen interest in ensuring that Kangankunde becomes a model of responsible and inclusive development rather than a repetition of past mistakes.

The conversation surrounding Kangankunde should not be framed as a conflict between investors and citizens. Rather, it should be viewed as a search for the best possible outcome for all stakeholders. Lindian deserves recognition for the investments and community projects it has undertaken thus far. Equally, Malawians have a right and responsibility to seek clarification on issues relating to licensing, ownership, value addition, infrastructure development, and long-term national benefits.

Ultimately, the objective is not to oppose investment but to ensure that the exploitation of Malawi's rare earth resources contributes meaningfully to economic transformation, job creation, industrialisation, technological advancement, and shared prosperity. Constructive questioning and accountability should therefore be welcomed as part of building a mining sector that serves both investors and the people of Malawi.

A survey conducted by the Malawi Women in Mining (MAWIMA) targeting their member cooperatives across Malawi has established that many women involved in mining activities are not aware of mining reforms that the Malawi Government is implementing in the sector.

Results of the survey highlights that a majority of women in mining are  ignorant of the reforms as no one has ever approached any of their cooperatives informing them of the  new laws and policies.

The survey results read: “The miners ae not aware of the reforms as there was nobody who visited the cooperatives to inform them of the current changes.” 

“Some gold miners only noticed that the gold buyers from other countries were not coming to buy gold from them, a situation which left them with the option to sell their products to Reserve Bank of Malawi through Export Development Fund (EDF).”

The survey also observes that some women miners especially in the southern region are only assisted by Civil Society Organizations (CSOs) including Centre for Environmental Policy Advocacy to get paperwork done like a mining license, trade license and approvals from Malawi Bureau of Standards.

Despite the mining reforms, the women miners continue to face numerous challenges including unstable pricing at EDF where the miners are legally allowed to sell their products.

It also says the women are lacking finances to access deeper gold deposits as a result they use a lot of effort just to get little gold which does not fetch good money at EDF.  

The results read: “Government and other agencies should consider creating awareness on the reforms to small scale miners.”

“There is need for financial support to acquire gold mining equipment including jack hammers and purifying equipment; access to stable markets and; strengthening cooperatives formation so that they can sell their products as a single package in order to improve their earnings and socio-economic status.”

The Mines and Minerals Act 2023 incorporates gender provisions sections which include promoting gender-balanced employment and training; prioritizing Malawian and women-owned businesses in procurement; supporting women-led enterprises near mining sites and; fair compensation and inclusive engagement with women and vulnerable groups.

The Malawi Government is spearheading empowerment of women through Innovation, Creativity and Entrepreneurship (ICE) model targeting women, youth, and persons with disabilities. The model is designed to support cooperatives, training, and enterprise development.

In an interview, Director of Policy and Planning Unit in the Ministry of Mining Patricia Zimpita said the Ministry is more committed to support women in mining understanding that they dominate the ASM subsector of the country.  

“Gender inclusion in mining is not optional; it is essential. The Ministry is committed to turning legal promises into practical action. Together, with MAWIMA and all stakeholders, we can build a mining sector that works for all. Let us walk the talk on this reform journey hand in hand,” said Zampita.

Zampita said that the Ministry is committed to implement gender-responsive subsidiary regulations; launch a dedicated funding scheme for women in ASM; ensure 30% representation of women in all governance structures; institutionalize gender impact assessments for mining projects and scale up capacity-building and market access for women miners.

The Southern Africa Resources Watch (SARW) report of 2018 states that women cater for about 30 percent of Malawi’s ASM workforce.

MUST has introduced 10 new postgraduate programmes aimed at creating more opportunities for advanced learning, research and innovation.

The new programmes, which are at both masters and doctorate levels, have been introduced in areas such as science, engineering, technology and the arts.

According to MUST Postgraduate Coordinator, Dr Jabulani Nyengere, the expansion reflects the university’s commitment to preparing graduates with skills that can contribute to solving real-world challenges.

“As a university, we continue to look at areas where we can provide relevant and specialised training. These new programmes will allow more students to pursue advanced studies while contributing to research and development in Malawi and beyond,” said Dr Nyengere.

At doctorate level, MUST has introduced PhD programmes in Science Communication; Geo-Information Science, and Applied Mathematics.

The new masters programmes include Science Communication; Geo-Information Science; Minerals and Mining Governance; Power and Energy Systems; Environmental Engineering; Water Utilisation, Waste and Health Engineering, and Music.

Dr Nyengere said the programmes respond to the growing need for experts in key areas that support national development.

“We need more researchers, innovators and professionals who can provide knowledge-based solutions in different sectors. These programmes will help build that capacity,” he said.

The introduction of the new programmes adds to MUST’s growing postgraduate portfolio and supports the university’s vision of advancing research, innovation and human capital development.

With these new additions, MUST now has 31 postgraduate programmes on offer.