‘Corruption plagues Uganda’s mining sector’

Kampala.

Uganda continues to earn peanuts from a potentially lucrative mining sector because of corruption and mismanagement that has affected regulation and licensing. A report by Global Witness, an international human rights campaign organisation reveals that the Directorate of Geological Survey and Mines (DGSM) may not actually be in charge of the mining sector.

“However, rather than fulfilling its mandate to work for the benefit of the Ugandan people, the DGSM is controlled by a hidden alternative power structure and decision making process or ‘shadow system’ which benefits predatory investors and politically powerful Ugandans,” the report reads.

There have been documented incidences where a company applies for an exploration license and once that is acquired, the companies go on to mine without filing reports. Their licenses are never terminated and there are no implications in terms of fines.

“Poorly qualified companies can win licenses based on their connections, at the expense of well-qualified and conscientious companies. The absence of respect for the rule of law and the systemic circumvention of policies and procedures undermines investment and puts Ugandans and their environment at risk. The underpayment or complete failure to pay taxes, mineral rents and royalties by many of those operating in the sector deprives the public coffers of millions of dollars a year. This affects the provision of basic services for ordinary Ugandans and further obstructs proper oversight and regulation of the industry,” the report goes on to read.

Global Witness notes that in 2012 a report conducted on DGSM was brought to the attention of the ministry of energy. It revealed fraud was existent but the findings of the report were never followed up on.