Malawi Action Plan Review 2023-2025 – For Public Comment
In 2023, the Independent Reporting Mechanism (IRM)The Independent Reporting Mechanism (IRM) is OGP’s accountability arm and the main means of tracking progress in participating countries. The IRM provides independent, evidence-based, and objective ... published the Action PlanAction plans are at the core of a government’s participation in OGP. They are the product of a co-creation process in which government and civil society jointly develop commitments to open governmen... Review for Malawi’s 2023-2025 action plan. The report provides a technical review of the action plan’s characteristics and the strengths and challenges the IRM identifies to inform a stronger implementation process.
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The report is available in English. The public comment period closed 13 July 2023.
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REP Reply
After a hiatus in Malawi on OGP, it is good to see the new commitments in the NAP. The continued commitment to improvements in the extractive industries is relevant given the renewed interest in minerals and increasing minerals prices in relation to projected increased demand for minerals necessary for non-carbon intensive technologies. Increasing oversight along the contracting cycle, including negotiations, is key and urgent. Three agreements are being (re)negotiated this year. One mining development agreement already been signed, with the support of law firms financed by one of the very same mining companies in negotiations .
In the new mining development agreement, fiscal terms remain in tact as per the Taxation Amendment Act (2016), which is promising given previous experience with awarding tax incentives that resulted in revenue loss, but did not ultimately affect the company’s decision to invest. However, there is also a highly unusual clause 27.3, which may result in revenue eroding tax incentives. It states that if other third-party large-scale mining licence holders enter agreements with government that include tax breaks and incentives then these will also apply to the company in the recently concluded agreement. This runs counter to best practice and may increase corruption risks in the negotiation of future agreements.