The Ministry of Mining, Blue Economy and Marine Affairs has published a preliminary mineral assessment report that shows that our counties – Meru, Tharaka Nithi, Embu, Kitui, Machakos among others are endowed with nine hundred and seventy (970) minerals. These minerals have been classified as having the potential for further prospecting for exploration to establish their nature, economic viability and their net worth in order to determine their commercial viability.
Counties have valuable minerals like copper, graphite, Manganese, Iron ore, Coltan (which is the principal mineral for laptops/computers and mobile phones and all electronics manufacturing globally), Thorium, Nickel, Cobalt, industrial minerals, base metals, precious metals, rare earth metals, radio-active minerals, gemstones, construction and building materials.
In the Eastern counties, major minerals found there include the iron ore because they are connected to the African Karoo formation that springs from South Africa all the way to Sudan, and which is a rich belt of iron ore and other related minerals. Iron ore is needed for steel making and hence supporting many sectors of the economy. Iron and steel forms 13 per cent of the manufacturing sector and supports sectors like housing and construction, energy and electronics and chemical and allied industries.
The direct and indirect use of steel is set to rise as the country is implementing the various development programmes including the Bottom –Up Economic Transformation Agenda (BETA), the Kenya Vision 2030 and various policies and priorities of the government, including measures to improve the economy, which in turn creates more demand for housing and construction activities.
The World Bank has estimated that iron and steel prices will increase by over 30 per cent, which can only be remedied through enhanced production of the same locally, and we have the raw materials in our counties.
Our Counties must do three things in collaboration with the National Government to tap into the presence of iron ore to stimulate growth. One, they must work with National Government and its entities to avail cheaper and manufacturing friendly energy and electricity tariffs. This will make our manufacturing competitive and hence enable the products produced locally to compete favourably to products from other countries.
Secondly, the counties must work with the National Government entities to zero rating Import Declaration Fees (IDF) and Railway Development Levy (RDL) charged on imported raw materials that support manufacturing. The cost of the imported raw materials that support manufacturing is a factor that contributes to the competitiveness of the manufactured goods locally.
Thirdly, Counties must work with National Government and its entities to incentivize local manufacturers to leverage on the locally available iron and coal projects to support local manufacturing that will create thousands of jobs and employment opportunities.
Counties must develop incentives packages and measures to support the local manufacturing that utilizes the local raw materials and minerals.
The minerals that have been highlighted in the survey have many lessons for Kenya. One, it confirms what Geographers have always estimated of the country that it is endowed with vast natural resources, both renewable and non-renewable ones like water, forestry, fisheries, and minerals like geothermal, wind, solar, coal, gas, and oil. These minerals and natural resources should be used extensively to ensure local economic growth and development.
Secondly, it builds on the consensus that there is need for enhanced mineral resource exploitation in Kenya through introduction of ground truthing to confirm accurate details, mechanization, efficiency and effectiveness. This has the potential to make the sector to contribute more than 10 per cent to Gross Domestic Product (GDP) by 2030, bearing in mind that a sustained 10 per cent GDP growth is what is needed to turn Kenya into a newly industrializing middle income nation providing a high quality of life for the citizens in a clean and secure environment.
A study by KPMG in 2016 found out that the sector contributes an average of 0.4 percent of GDP. In 2020, the mineral sector contribution to GDP was 0.7 percent and in 2021, it was 0.8 percent, which means more can be done for the sector.
Mineral extraction faces many challenges including use of outdated technologies, limited financing for large scale mining activities, environmental pollution, degradation, and reliance on small scale and uneconomical mining operations.
Thirdly, by mapping out the minerals, the country and counties can operationalize effective partnerships and collaborations to exploit the mineral wealth within our borders.
Fourthly, there is need for operationalization of the value chain approaches, value addition and manufacturing through Public Private Partnerships (PPPs) and other collaborations for effective extraction and utilization.
In the US, mineral exploitation generates 1.3 direct and indirect jobs and each job in mining generates 2.9 other jobs, in addition to paying increased taxes.
OPINION By DR DANIEL MUTEGI GITI
Dr. Mutegi Giti is an Urban Management, Public Private Partnerships (PPPs) &Environment Specialist.
Email:mutegigiti@gmail.com.
Twitter:@DanielGiti.
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