December 14th 2017

Society / Environment

EADB funding capacity building for mining regulation in East Africa

“It is critical that host countries are able to derive tangible benefits from the exploitation of their natural resources. The benefits should accrue to the local communities in form of appropriate royalties, taxes, dividends, business opportunities, professional jobs and employment

By Free Press Reporternewsdesk@kenyafreepress.comSunday, 21 Aug 2016 17:26 EAT

Attorney General Githu Muigai has asked public sector lawyers in East Africa to ensure that mineral wealth brings East Africa long-term economic development through preventing resource dependence and encouraging economic diversification. This will encourage job creation despite the sector’s capital-intensive nature, by minimizing environmental degradation and allowing for the benefits to accrue even after depletion of the resources.

In a speech read on his behalf by Deputy Solicitor General, Ms Christine Agimba, at the closure of a high level seminar for East African Judges in Nairobi, Prof. Muigai observed that governments in the East African region are increasingly putting in place legal and regulatory mechanisms to support  investment in the extractive sector. This includes reviewing of outdated legislation and the enactment of new laws as well as other mechanisms to improve the investment climate and enhance the ease of doing business.

The AG highlighted new business laws Kenya has enacted to improve the environment for doing business, among them the Companies Act, Insolvency Act, Business Registration Service Act, Insolvency (Consequential Amendments) Act. “We are also focused on reviewing outdated legislation regulating the extractive sector and enacting legislation that is aligned to the Constitution of Kenya, 2010.”

“The rise of exploration activities has also seen a rise in litigation both before Kenyan courts and internationally in forums like ICSID (International Centre for Settlement of Investment Disputes) and this calls for a closer examination of how disputes are resolved. Most of the African countries are now trying to build their own capacities to handle complex commercial disputes with the setting up of regional Centres for commercial arbitration, with one being here in Nairobi, Rwanda, Mauritius, Egypt among others,” said Prof. Mugai in his statement.

EADB Director General, Vivienne Yeda, observed that the discovery and ongoing exploration of various minerals in the region has raised the expectation of host communities and governments that mineral extraction will result into wealth creation, reduced budget deficit and improve the conditions of the local people.

“It is critical that host countries are able to derive tangible benefits from the exploitation of their natural resources. The benefits should accrue to the local communities in form of appropriate royalties, taxes, dividends, business opportunities, professional jobs and employment for skilled labour,” said Ms Yeda.

She added that there should be a clear benefit to the country, commensurate with the amount of resources derived for the country. In order to achieve this, taxes and other fiscal rates, environmental and social management in Africa should be comparable to those prevailing in advanced economies.

The training seminar was organised by EADB and facilitated by global law firm, DLA Piper. It was designed for judges from the East African region involved in arbitrating transactions and settlement of disputes in the extractive sectors. In a bid to support endeavours by East African governments to promote and advance extractive industries, EADB, in collaboration with DLA Piper have held a series of regional workshops for the legal profession.

Speaking at the closing ceremony of the seminar, Justice Henry Ridgely of DLA Piper stated: “We are very pleased to be collaborating again with EADB in capacity building in East Africa in the extractive sector. We are happy to assist the region in realising this objective.”

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