Four times more licenses for mining projects were granted in the conflict period than in the previous 14 years. CIP says biggest beneficiaries of mining concessions are "unidentifiable individuals".

A study released by the Center for Public Integrity (CIP) and cited by DW indicates the sharp increase in the number of permits granted for mining projects in Cabo Delgado over the past four years, in the midst of a security crisis in the northern province. 

CIP consulted data from Cabo Delgado's mining cadastre, which show that in the 14 years prior to the terrorist attacks in the province 67 licenses were granted - an average of five per year. On the other hand, from 2017 to February 2021 alone, in the middle of the armed conflict, 46 mining projects were licensed - more than double the average number of concessions in the "years of peace." Compared to the previous 14 years, the number of concessions increased by 68% in the four years of attacks.  

"It was expected that - with the armed conflict that may extend throughout the province - there would be a reduction in requests for mining concessions, this following the logic of a rational investor, who reduces his investments when uncertainties, mainly war, increase. However, the data show a completely different situation in Cabo Delgado," says the CIP research. 

The IPC points out, however, that the data analyzed "showed that it was not possible to establish a causal relationship between the exploitation of mineral resources and the armed conflict, because the districts hitherto taken over by the insurgents are devoid of licenses for resource exploitation in the province." 

Hidden Beneficiaries

The mining projects are focused on exploration for ruby, gold, graphite, building stone, and tourmaline. The Mozambican watchdog's investigation identifies two types of legal beneficiaries of the concessions - one type with low equity and another with almost full equity.

"In these cases, it almost always turns out that the legal registration of the holder of the largest capital is an entity legally registered outside of Mozambique," often in Mauritius, a country considered a tax haven. 

According to CIP, much of the mining concessions in Cabo Delgado are in the hands of three companies, whose beneficial ownership could not be identified. "Of the 113 mining concessions in the province, 7% are owned by the company Nairoto Resources, 5% to Gemfields Mauritius, and 4% are held by Kukwira." The first two companies have registration in Mauritius, the last was registered in Mozambique. 

No benefits to the population

The executive director of the Civil Society Learning and Capacity Building Center (CESC), Paula Monjane, defends that a factor for the fair distribution of the wealth produced by the extractive industry is precisely transparency, the principles of which were clearly violated in the cases investigated by the CIP. 

"[There is still a] debate about the compensation of affected communities such as Namanhumbire, Moatize, Moma, Marara, Palma and the benefits of host communities of natural resources such as Palma, Montepuez and others," says Monjane

Monjane and economist Nuno Castel-Branco participated this Tuesday (03.08) in the round table "Extractive Industry in Mozambique: challenges, successes and perspectives", promoted by the Institute of Social and Economic Studies (IESE).

"Redistribute income more fairly, through basic income security systems and public investment in basic goods and services that guarantee social stability, improve quality of life, and promote development," Castel-Branco suggested. 

In addition to the lack of transparency, members of civil society organizations complain about the lack of local development plans and criticize the precarious social conditions in many resettlements generated by extractive industry projects.