Coltan Discovery Ignites Excitement in Kenya’s Mining Sector

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All right finally we come to our focus of the day and this touches on the mining sector now the ministry of Mining and blue economy is currently in the process of tracking the economic value of colon and uh for majority of Kenyans I mean we’re here in Colton for the first

Time last you’re very much interested in in this world of minerals now what does this mean uh for the the country and different sectors within the country right now about to have this discussion I’m joining in Studio by Dr Patrick canoro is the chair of Kenya chamber of

Minds thank you very much sir for making time to speak to KTN business today thank you Noah for having me here all right it’s an honor to me and to our industry so mining even before we go to the culton issue yes mining is is a very it’s a huge sector yes

But it’s one of those sectors that we really don’t talk much about it unless something as cold and happens and everyone is like what exactly is going on maybe paint for us the picture of Kenya’s mining sector how large is it how much are you guys contributing to uh

Our economy even as we think about repaying our 2024 Euro bond which come which is due in June yeah thank you thank you Noah uh just to paint um a picture of um what what um the mining sector is in Kenya uh I will look at two pictures I

Look at our current situation then I look at our potential now currently mining is contributing around about 1% to our GDP and 1% to our GDP is fairly small uh granted that we are we have two advantages one we are very well located geologically and we have a very nice location

Geographically given that Kenya is endowed with different minerals then uh doing 1% is doing a bit too lalh however there are uh efforts from government from the private sector from all the stakeholders to take the 1% to 10% of GDP by 2030 we have no doubt in our minds that if

Indeed government put the right policies in PR this can even be done in the medium term it’s something that we can do in four five years yes oh so we hold so much potential uh unfortunately there are challenges and we’ll look into that uh but for starters I mean looking at at the

Different tiers within the mining sector because like any economy we pretty much teared up when I talk about businesses in the country yes majority of the businesses are micro and small businesses when it comes to the mining sector how are we segmented uh in the mining sector we

Have um basically uh two or three tiers the very first one are the artisano and small scale Miners And when we talk about artisano and small scale miners we are talking about um what you would call jari you know uh because the artisano and small scale miners are people who are doing

Mining on a very small scale and that scale is basically to uh take care of their livelihoods and perhaps make a little a little more beyond their roods so we have the artisan and small scale min but most of the artisano and small scale miners are in the gold and

Gemstone sub sector that is where the bulk of the miners are then you come to medium siiz operations and medium siiz operations are operations that will have a premises that will have uh you know some level of capitalization and equipment and uh at that level you’ll then talk about an operation that is

Employing 20 people people 50 people perhaps 100 people then from there we go to the Raj operators and we have very few large operators in this country but we have large operators that employ people in hundreds and um perhaps uh one of our biggest operators is based titanium employing well over

1,500 people okay yes so very very much T it’s very reflective of the Kenyan economy it doesn’t change much and now this brings in the value because when we talk about for example when we are paring or what what’s happening and uh you know people say just oppose these two sides you you

Find that majority of our small businesses have very huge struggle they struggle the most and even when we are forming interventions which we’re going to talk about later on you have to think of this different tiers differently yes so for for the mining especially the artisinal ones the small ones who are

Majority uh what challenges are they facing I think that is one and two you can also touch a little bit on the interventions that you say if Government can do something about it then even in the medium term we can achieve that 10% contribution towards the GDP uh thank

You Noah uh in terms of the artiso and small scale um miners some of the one let us agree that mining ordinarily happens in very remote locations so that is challenge number one that where these mining activities is happening particularly for gemstones and for gold most of those places have uh basic uh

Inadequacy inadequacies in terms of water in terms of infrastructure access even to the mines and um also things like power so so that alone then um works against a lot of things because if people cannot access water they cannot access access power they are not able to

Access their minds in good time it means that even getting whatever it is they are mining again back to the market all the buyers accessing the mine is still a bit of a challenge now having having said that I also want to do mention that um the artisano and small scale miners

Are a very critical part of how this industry will evolve why do I say so all over the world artisano Miners and the small scale miners have informed how the big prayers will get into the industry because big prayers have followed the discoveries that are made by the artiso

And small scale miners so they are important part of helping us have the industry take off okay in terms of um what interventions would be necessary uh this I would address not even to the national government I would address this to the County government why do I say so

Because County governments are at that level of government where they ought to support their communities resident in their respective counties to access the basics of water medical facilities you know access roads and and and and yes those interventions would make would help us start transforming the ASM obviously there’s also need for access

To training access to technology but that will come after we have the basics right yeah and considering that there is an industry that has been there I mean when we go back in history how long have you been doing extractives in this country I will say that from what I have

Read mining has happened in this country for well over 100 years and that is what disturbs me that indeed this is a sector that has existed for 100 years but still remains pretty mysterious to our people we therefore need to work all the stakeholders government private sector Civil Society organizations to domestify

This sector so that then we can have more people on board definitely and and in in that regard now it brings the question you’ve said big players are very are very much uh very few you’ve mentioned the lacks of best titanium uh middle uh not a huge size

Sort of countable uh and these are uh companies that um when you talk about as are they operating also in companies or this is sort of sold proprietorship okay The Artisan miners in this country have largely operated as individuals however in some areas in the last 4 five years some operated as

Associations as what they call cbos you know Community Based organizations uh but um the Kenya Quanza Administration has been very deliberate on how it wants to drive the agenda in the mining sector and um all those that have been individuals have been in associations have been in cbos have been encouraged

To form cooperatives so that then they start running uh the mining business as a business okay because we all know that associations are not business outfits M yes ah so find a way of being Incorporated that’s right okay it seems that is again placing a mirror it’s sort of like

The way we call on uh the in quote unquote inform formal sector majority of businesses falling under quote unquote informal sector to formalize Yes uh and in in in this other world uh we see a challenge transitioning of course when you formalize there is the element of

Taxation uh a lot of people are not getting that support so a lot of people operating under the radar is there something that is sking uh the small scale miners maybe they just want to do it solo you know and under the radar that that they’re not converting I I

Will say that um there are two or three reasons uh like you’ve correctly put it um a lot of people operate they are not you cannot Trace them and why is this happening this is informed by a lot of things uh the first one is what I said

Demistifying the sector is there enough training is there enough education is there enough awareness of what people are dealing in remember that until um 2016 when we got the new mining act or let me not say the new mining act because it’s it was in 2016 when we got

The mining act previously we ran on a mining act that had been enacted in 1940 so it took us round about 76 years to to reinvent our way as Kenyans and get into mining business now until 2016 anybody found with a mineral was uh was taken in as a criminal and therefore

We are grateful that the 26 the enactment of the 2016 mining act at least decriminalized uh mining however as old habits die had it took pretty long time and I am very grateful that indeed the Kenya Quanza Administration uh through a cabinet um meeting I think on the 3D of October

Made it very clear that the government of Kenya has decriminalized artisan and small scale mining now to answer your question because of being perceived as though they are doing something that is illegal yes then people producing gemstones and gold have preferred to operate under the radar so that then they are not visible

However now formalization is helping us uh put things in perspective and when we formalize of course there are still fears that um when I formalize I’ll pay taxes and again here we must have a sincere conversation we cannot build this economy without being honest without being faithful without being patriotic

And and I I represent miners here and I do know have spoken to a lot of them miners do not have issues paying taxes but what they want is a tax system that is efficient that is easy for them to understand because remember uh some of most of the miners particularly asms

Operate in of what do I say they can’t access Internet they don’t have smartphones so trying to ask them to do a complicated process uh will further make them go underground so um so long as we support them uh give them time to transition from where they are to

Formalizing I have hoped that we are on cost okay and we’ll do the right thing definitely so Dr Cano we we want to take a short break yeah but when you come back yes I want you tell us whether we’ll be balling as young people say yeah we will be chopping money because

We have cult or it will be the same situation as oil Discovery that’s the big question yeah so we take a short break right here business today remember we are talking abouts mining sector specifically new discoveries in the country that we have plenty of minerals what does this prend for these economy

And what does it mean for you and me stay tuned we time with more