Ethiopia’s mining revenue falls sharply

0
159

Although, Ethiopia considers mining to be one of its main foreign currency earnings, the revenue from mineral exports drastically fell for the last nine months of this fiscal year, reports the third mining council after a meeting held in Addis Ababa last Tuesday.
According to Samuel Urquato, Minister of Mines and Petroleum, the country earned only 39.6 million USD against the projected 766.9 million USD in the stated period.
Only 8.85 percent of the target was attained by the ministry, according to Kiros Alemayehu communication officer at the ministry.
The revenue declined by 78.5 million USD compared to the same period last fiscal year.
According to the ministry, various reforms are under taken to fix the huge mismatch and maximize the revenue from the sector and pointed out that Ethiopia is in the final stages of reforming the mining sector to shore up its potentials.
Mines and Petroleum Minister Samuel Urkato pointed out that the major factors that contributed to the low performance were peace and security, illegal mining, corruption, and rent-seeking, contraband trade of minerals and shortage of foreign currency for importing inputs have contributed to the income decline from the sector.
About 160 companies are engaged in the sector and the ministry hopes to attract more foreign investors.
Other than gold, which is the county’s major export mineral, Ethiopia exports: sapphire, opal, tantalum, emerald, gemstones, marble, and other metallic and non-metallic minerals. The country is also endowed with huge deposits of phosphate and potash minerals.
Presently, mining contributes only 1 percent of Ethiopia’s GDP. Gold, industrial minerals and gemstones make the bulk of the mining commodities the country exports. Tantalum is also proving to be profitable.
Although Ministry of Mines and petroleum announced that the mining sector in Ethiopia is expected to contribute to the transformation of the country from an agriculture led economy to industry, the mineral export earnings, have been declining in the past consecutive years, the sector registered low revenue of 130 million USD in the 2017-2018 fiscal year that ended last June.
The country used to earn more than 600 million USD from the mining sector.in 2011-2012, the nation earned 618 million dollars from mineral exports
In 2014 the country earned about 541 million USD from mining exports. This largely declined because gold production was inefficient. Ezana gold mine failed because hard currency was scarce and MIDROC also had difficulties with complaints from the local community accusing the company of polluting the environment.
MIDROC Gold previously exported four tons of gold per annum from its Lega Dembi gold mine in Oromia Regional State.

LEAVE A REPLY

Please enter your comment!
Please enter your name here