Mining minister Najib Balala said taxation of the sector was a function of the central government. PHOTO | FILE
Private sector players want a say in the preparation and enactment of laws on sharing of minerals and oil wealth, arguing some laws are scaring away investors.
Mr Richard Omwela, a managing partner at Hamilton Harrison & Mathews, said that numerous Bills and regulations on the mining sector call for consultation with industry players.
“The private sector needs to be involved in making regulations rather than wait until latter. Don’t let others brew coffee for you. Let’s be involved in the brewing,” Mr Omwela said.
He said the Energy Act of 2014, the Mining Bill 2014 and regulations that have been published need to be scrutinised by industry players to ensure protection of the interest of businesses, the government and communities.
“The government should not re-write the script. This is not the first country to find oil or mine it.
Scare away investors
‘‘We must be involved in the enactment of laws to ensure that we don’t borrow bad practices from Nigeria and Angola. Let’s get best practices that can work for our communities,” he said.
Ms Mary M’Mkindia, a management consultant in the oil and gas sector, said that laws which regulate the petroleum business need to be harmonised.
‘‘There is a lot of contradictory laws that will hamper development. We have six to eight Bills pending, some of which call for renegotiations of some contracts already signed. This will hamper investments,” she said.
One Senate Bill proposes that counties be allocated 32 per cent of fees and royalties, the government 48 per cent and the yet to be established sovereign wealth fund 20 per cent.
But the Mining Bill proposes that the national government retains 75 per cent of royalties and 25 per cent goes to counties. Kwale, Lamu and Taita Taveta county leaders have also proposed new taxes on investors exploiting minerals, gas and oil in their areas, proposals which the government said could scare away investors.
Mining minister Najib Balala said taxation of the sector was a function of the central government.
ARM Cement chief executive Pradeep Paunrana said the sharing of royalties and other benefits is a contentious matter in the extractive industry. The industry players were speaking on Friday in Kigali, Rwanda, during the sixth East African Business Summit.
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