Complete Book PDF (4.12MB) - World Bank eLibrary

416 Diagnosing Corruption in Ethiopia
Recommendation 7: Establish a licensing authority and mining
company forum.
A forum should be established made up of senior members of MOM, the
regional and city licensing authorities, the FEACC, and mining companies.
This forum should meet periodically (such as once every quarter) to
discuss how to improve license issuing, license management, and anticorruption
mechanisms.
The Ethiopian mining sector is currently a relatively small part of
Ethiopia’s economy. Therefore, the extent of corruption in the mining
sector appears to be lower—both in occurrence and in value—than in
other Ethiopian sectors such as construction and telecommunications.
However, the sector’s rapid expansion will increase both the risk of corruption
and the amounts potentially lost to corruption. Effective anticorruption
action is imperative. The implementation of effective actions not
only reduces the extent of corruption but also reduces the perception
that corruption is occurring.
Notes
1. For further information on corruption in the construction sector, see chapter 6
of this volume—“Construction Sector Corruption in Ethiopia”—as well as
the Global Infrastructure Anti-Corruption Centre’s free online resource,
http://www.giaccentre.org.
2. The Ministry of Mines and Energy was reorganized and renamed the Ministry
of Mines in 2010.
3. Five licenses were issued for prospecting, 109 for exploration, 19 for smallscale
mining, and 27 for large-scale mining
4. Federal Democratic Republic of Ethiopia (FDRE) Mining Proclamation
No.52/1993; Mining (Amendment) Proclamation No.22/1996; Mining
(Amendment) Proclamation No.118/1998; Mining Operations Council of
Ministers Regulations No. 182/1994; Mining Operations Council of Minister
(Amendment) Regulations No. 27/1998; Mining Income Tax Proclamation
No.53/1993; Mining Income Tax (Amendment) Proclamation No. 23/1996.
5. An attempt has been made in relation to each risk area to rate the potential
degree of corruption risk at the federal mining license level (for example, low,
medium, or high). Obviously, the rating is subjective without hard data on
which to base this assessment. No attempt has been made to rate the risk at
the city and regional levels because there are likely to be major discrepancies
in the degree of effective control between the different cities and regions.
However, it is likely that the risk level will be higher at the city and regional