Mining companies involved in extracting and exporting rare earth minerals in Burundi have been suspended from operations pending a host of charges and violations.
Prime Minister Alain-Guillaume Bunyoni did not have kind words for these mining companies and that brings the whole affair to another level.
“Many of these companies have received formal warnings to immediately shut down their operations because we realized that they were only there to plunder our mineral wealth,” the Premeir said.
“They duped the government from the conventions that govern their operation to the execution of their activities. Kind of scoundrels, ”Prime Minister Bunyoni said earlier in April.
Rainbow Mining Burundi was specifically notified to suspend all its operations and received a formal notice.
In a letter dated March 31, 2021, the Prime Minister specifies to the Ministry of Hydraulics, Energy and Mines that following the progress report of the evaluation commission of the mining agreement on the deposits rare earths from Gakara, the export of rare earths is now prohibited pending the violation of the Agreement signed between the Burundian Government and the company Rainbow mining Burundi.
However, later on May 18, 2021, Rainbow Mining wrote to the government to request negotiations to adopt the win-win principle.
On June 24, 2021, the Ministry of Energy and Mines announced the suspension of rare earth extraction activities at Gakara “until the adoption of the clauses resulting from negotiations between the company Rainbow mining Burundi and the Burundian government. “.
According to local media reports, the mining companies paid hefty bribes to senior government officials and dodged taxes or, in most cases, declared very low taxes.
According to a source, the Rainbow Mining Company paid a minimum tax on the value of the various elements contained in the rare earths; “The company only paid its taxes on the basic elements and not on the associated elements among the rare earths.
“As Rainbow mining is reluctant to show its results in terms of content for the rare earths it exports, the state only receives 10% of the profit from what it should have,” said a source within the ministry in charge of mines.
The Rainbow mining company is also accused of failing to honor its contractual obligations contained in the agreements.
For example, “It was planned to build socio-economic infrastructure such as schools and health facilities. For example, the company had to build a technical school in Mutambu (rural province of Bujumbura) and an asphalt road leading to it, it did none of these.
According to the Ministry of Mines, the state has the right to suspend the continuation of mining operations carried out by the company.
Gabriel Rufyiri the president of Olucome – an Observatory for the fight against corruption and economic malfeasance argues that the problem stems from the mining law.
“It is said in the Mining Code that the company signing the agreement owns 51% of the shares, 39% held by other shareholders and 10% of the shares belonging to the Burundian state. Under these conditions, the win-win principle is not possible. “
Gabriel Rufyiri also points to the responsibility of the public authorities: “How is it that things have come to this when the State has a vice-president on the board of directors within the mixed mining company without forgetting to” other members of the same Council? “
“When we look at the international markets, we realize that Burundi exports large quantities of raw materials, but we will never know the income from their sale. It is the plunder of mineral resources. But by whom? That’s the big question, ”Rufyiri notes.
Rufyiri calls for this case to be brought to justice; “We must prosecute those who have represented the Burundian government in the negotiation and control of mining by companies. This is the crux of the matter. “
“The code, which there is reason to believe that it will be amended, must not be implemented behind closed doors, but be the result of a consensus between all the partners (government, civil society, etc.)” , he concludes.