Workshop on Mining Taxation: Transforming Mineral Wealth into Sustainable Development (19/12/2011)

The workshop on Mining Taxation: "Transforming Wealth into Sustainable Development", jointly organised by the European Commission and the African Union Commission in cooperation with UNECA, was held on 9-10 December 2011 in Addis Ababa. It brought together experts from both the public and private sector and resulted in a set of concrete proposals that were presented to senior experts at the second AU Conference of Ministers responsible for Mineral Resources held on 12-16 December. The recommendations made, notably regarding effective regulation in extractive industries and capacity building in the domain of domestic resource mobilization through taxation regimes, should strengthen the implementation of the Africa Mining Vision.

The workshop discussed the relationship between natural resources, taxation and development, as well as the political economy of extractive industries. The workshop addressed a variety of concrete topics, such as licensing and contract negotiations, fundamentals for effective extractive industries and taxation regimes (such as royalties, corporate income taxation and production sharing), strategies for effective implementation and control (such as the auditing of multinational corporations and transfer pricing), and the creation of incentives for sustainable mining.

The workshop concluded that African countries had to adopt visions for their mining sectors and that these visions should guide the establishment of effective taxation regimes. National mining policies of resource-rich African countries should be aligned with the AU Mining Vision. The right balance must be struck between augmenting domestic revenue collection and attracting and retaining investors. African countries should observe the principles transparency, exchange of information and fair tax competition, and focus on capacity building in relation to domestic resource mobilization in the extractive industries - particularly in the domain of tax administration. Donor support should be coordinated to harmonize all capacity building efforts.