Sunday, March 9, 2014

Civil society voices heard on Mineral Law

By Javed Noorani

Afghanistan’s mineral law of 2010 scored 63 marks out of 100 during the resource governance index which was carried by Revenue Watch Institute in 2012. The law was the best in the region according to the Resource Governance Index but had weaknesses which could have been ironed out with informed amendments.  The Ministry of Mines and Petroleum, to the shock of people who were worried about the weaknesses of the 2010 Law, introduced a new draft mineral law infested with fetal weakness and sent it to the Cabinet of Ministers for approval. However, it was timely and rightly stopped by some senior leaders for its conspicuous flaws which triggered the debate over it and its contents. Integrity Watch Afghanistan opposed the law based on its understanding of the mining sector and politics wrapping it and met some senior and influential officials in the government and Wolusi Jirga to seek interventions for bringing necessary amendments.
It is imperative to underline that the MoMP redrafted the old Hydrocarbon Law without any consultation and got it passed in the cabinet without much read about it. It is equally critical to underline that there are rumors that some ex-high level officials at the MoMP was approached by lobbies based in Dubai along with the powerful local lobbies and influenced them to redraft the law to their interest. This is subject of research right now.
It is important to underline that Afghanistan loses up to half a billion dollars annually due to illegal and legal mining across the country. Every year up to 4 million tons of coal is extracted while little rent on it is paid to the state and the rest of it has gone to the company. Similarly there are other companies which over produce and underpays. Integrity Watch based on rough data carried out a calculation which shows that Afghanistan’s mining industry is as much as US$ 750-800 million dollars.  The figure excludes revenue from Amu Darya and Aynak Copper Mines. The government has however not been able to collect even a small percent of the rent from the sector largely because powerful lords are involved in extraction while officials of the government provide them the escape route.

Integrity Watch and Global Witness carried out analysis of the draft mineral law in the light of the above facts.The analysis of the draft mineral law and found out that the bill was deficient, weak and poorly worded to leave loopholes for mining operators to escape legal nets.The draft mineral was introduced to nurture the oligarchs and open an inlet for the construction lobby to jump into the mining sector and capture the sector.
The civil society made a robust attempt to reach the President of Afghanistan and the effort led to fruitful discussion and a channel was opened to civil society to flag its concerns on the mining sector. The advocacy with the President’s office had some positive results. The president’s response was heartwarming at the early stage.
The second stage which we thought to be the last opportunity for intervention started at Wolusi Jirga. Integrity Watch and Global Witness reached out to over 35 members of Wolusi Jirga to discuss the law and the missing essentials which were imperative to give a decent start to Afghanistan to develop the mining sector and retain a good percentage of resource rent.  The engagement with the Wolusi Jirga to mobilize members of Parliament and seek a debate over the law was interesting and the MPs felt the importance and need for further work on the draft. While Integrity Watch and Global Witness continued its efforts with members Ministry  of Parliamentary Affairs to feed the Parliament with more technical issues to take out the weaknesses of the law. But this effort did not bear much fruit because the political will at the Ministry of Parliamentary Affairs to support civil society in this regard eroded.
The law is the first of its kind that has been contemplated by government and Wolusi Jirga and it was held in the House of Representatives for 4 months without making an inch progress yet the process was so positive and becoming of a Parliament.  The mining Lobbies which have strong support in some ministries were confident that Wolusi Jirga will pass the law and to their shock the law remained under debate until 21st January the last day before the Parliament went on recess.
The lobby saw the winter break for the Wolusi Jirga as an opportunity to impress the President with the argument that the mineral law was in national interest and it would bring US$ 20 billion in investment to country. Ironically, the people who tied the law to national interest are the same people who have been plundering this country and their effort was a way to define their interest as national to get the law passed. A simple question that was volleyed in their court, was the productivity in terms of revenues to the state from the 300 signed contracts in the mining sector.
The voice to call on the President of Afghanistan grew denser asking his Excellency to pass the bill through a decree. It yet came as another shock to the civil society activists who were opposing the law. One of the civil society activists narrates his reaction and follow up with the President of Afghanistan as,
When I heard Qorban Haqjo of the Afghan Chamber of Commerce and Industry  saying that the President of Afghanistan has agreed to pass the bill through a decree to make it a law, I wrote to the President’s Office  that the draft law in its current form will be the worst service one could do. Within 5 minutes of my writing to his office, I received a call asking me what were my concerns about the law. I narrated the issues with the law and I was asked for more points. I sent them the next day and they called back to confirm the reception of the points.
The process continued and the President withheld his signature and seemingly called for a technical committee to discuss the draft further before he signs on it.
The law is in limbo for the third time and as a civil society activist I rejoice to see a debate engulfing the state, government and civil society.  The diplomatic community is divided. On the one side there are people who understand civil society’s concerns on the other side the focus is on the law as a milestone of Tokyo Mutual Accountability Framework (TMAF). The side pushing for the law does so without peeping inside it to understand if it will serve the needs of Afghanistan. The law will not serve the    genuine and professional investors.
All in all, the interactions with various stakeholders have been both challenging and encouraging. The Afghan mining sector is facing massive challenges due to illegal extraction and powerful elite entering the sector, while we will continue to advocate for change to ensure the collective good of all Afghans. 

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