Kenya to Curb illegal Mineral Operations by Withdrawing all Trading Licenses

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Kenya has said it intends on withdrawing all mineral trading licenses as part of an effort to wipe out illegal operators within the sector.

The move is also to regain control of the multi-million industry. Mining Cabinet Secretary, Dan Kazungu, disclosed that dealers would now have to be vetted anew in a nationwide crackdown set to start sometime next week.

“Our estimates show that only 20 percent of mineral traders are licensed,” he said, adding that the vast majority who did not have permits could be facing major crimes in the country.

Gold mined in Eastern Africa, mostly from the unstable Democratic Republic of Congo, is among the various minerals traded informally. In one of the most recent cases of suspected fraud, businessman Jared Otieno was arrested for allegedly conning some foreigners of Sh183 million.

He explained that legitimate international traders were losing confidence in Kenya. Fresh issuance of trading licenses is the first step towards setting up a regional mineral exchange, which will provide a platform for buyers and sellers to transact above board.

The new directive would also enable the State to collect revenues from the trade while boosting confidence since the players would be well known.

A team from the Ministry of Mining has been formed to work with police to crush unlicensed traders – most of whom make huge profits from trading in precious minerals such as gemstones. Kazungu said the team would start work by Monday next week before new licenses were issued.

Since 2016, no new dealer permits have been given, when the ministry suspended issuance as a first step to streamlining the sector.

For instance, in 2013, hundreds of mining licenses were withdrawn for fear they were issued illegally in an already murky industry.



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