20/04/2026
A STRUCTURED MARKET IN NAME ONLY: WHY MALAWI’S GEMSTONE SYSTEM STILL FAILS MINERS, 2023–2026
The recent licence registry audit by the Mining and Minerals Regulatory Authority has revealed that there are over 1,000 small-scale mining licence holders in Malawi, the majority of which are gemstone miners. These miners form the backbone of the subsector, yet they remain the most exploited. For decades, foreign buyers have controlled pricing, grading, and market access, leaving local producers with little bargaining power and minimal returns for their stones.
The Reserve Bank Of Malawi , through its subsidiary Export Development Fund EDF, launched a gemstone purchase program in 2023 to manage foreign reserves prudently. It promised formal miners a structured, transparent market and pledged the country a new reserve asset. Three years later, the results undermine both objectives. Between 2023 and 2026, EDF — with all its resources — sold only 3,666.6 carats of assorted gemstones out of 158,012.15 carats, generating just $67,850.46. EDF blames the February 2025 export ban for poor sales. But if a central bank-backed company with full state support cannot find viable markets, what chance does an ordinary miner have? In contrast, EDF has spent over MK171 billion on gold since 2021 — over 100 times the MK1.7 billion it spent on gemstones — despite gemstones making up the bulk of small-scale mining activity.
It is also sad that EDF only buys rough gemstones — not cut and polished — and has no proper grading, certification, or appraisal systems, which a fully formalized industry requires. By refusing cut and polished stones, EDF discriminates against miners and dealers who invest in value addition to maximize profits. Without these systems, stones are bought using informal local assessment only, not internationally recognized standards such as those set by the World Jewellery Confederation - CIBJO , the Responsible Jewellery Council (RJC), or International Colored Gemstone Association (ICA). This means EDF cannot prove it paid fair value, and the miner cannot prove they received fair value. Compounding this, Malawi’s gemstone sector produces over 25 different types of gemstones, yet EDF only buys a select few. Most miners therefore have no access to the Fund, even when they hold high-grade gemstones, because EDF does not trade what they produce.
It’s worth noting that currently the Malawi Government does not have an accredited gemologist. The sole qualified gemologist, trained in 2014 at AIGS in Thailand, retired in 2024 and was unable to introduce proper grading and certification systems during his tenure. It is also strange that EDF, which claims to have an in-house gemologist, is yet to establish proper grading, certification, and appraisal systems. The institutions responsible for the structured market have compounded this by hiring personnel not accredited by reputable gemmology institutes. Without accredited expertise, they failed to adopt international standards, and the “structured” market remained informal in practice. Elsewhere, countries like Sri Lanka and Thailand have dedicated Gem and Jewellery Authorities that oversee the sector and collaborate directly with gemological laboratories and institutes to regulate, train, and promote their industries. Tanzania established the Tanzania Gemmological Centre in Arusha, a state-backed laboratory providing certification, training, and research to support its coloured gemstone sector. The gemstone industry is a multi-billion dollar, lucrative industry and needs real expertise to lead the transformation — not just anyone.
This disparity has real consequences for miners on the ground. The Mining and Minerals Regulatory Authority (MMRA) has blamed Artisanal and Small-scale Miners (ASM) for “inactivity.” The truth is simpler: these miners have no market. EDF has never issued offtake agreements that miners could use to secure financing from commercial banks. As a result, no commercial bank has extended credit to the gemstone sector, and the Malawi Enterprise Development Fund Limited- MEDF has not supported a single gemstone miner. Without a guaranteed buyer, formalization becomes a financial dead end.
The gemstone export ban imposed in February 2025 was intended to curb undervaluation and smuggling. Instead, the ban caused many miners to suspend their work because they can’t sell locally or export. The sector had hoped EDF would step in as the ready domestic market, but EDF appears to have scaled back gemstone purchases well before the ban took effect. The ban has therefore left miners holding stock they cannot legally sell, while the promised alternative market does not exist in practice.
This was made worse by a further ban on exporting raw gemstones imposed in October 2025. The logic of forcing value addition is sound, but no one wants to buy gemstones from miners just to stockpile them in the absence of processing facilities. Without cutting, polishing, and certification infrastructure, “value addition” cannot happen. There is hope that the Malawi Mining Investment Company (MAMICO), which holds a reserved minerals licence and is planning to venture into gemstone and jewellery, will give miners another market. Government should now help identify and activate offtakers for processed gemstones, including EDF and MAMICO, so that miners have a real incentive to process and a guaranteed market to sell into.
Formalization itself has become a burden without benefit. Miners are required to undergo an expensive process of licensing, environmental compliance, and statutory fees. They must also self-finance operations. Yet the Department of Mining Mw has provided no training, technical support, or market linkage to help them meet these requirements or recover their costs. Miners are regulated like companies but given none of the tools companies rely on. The highest form of formalization is certification and appraisal — systems that verify quality and provenance under international standards. Malawi could adopt recognised frameworks such as those from the World Jewellery Confederation (CIBJO), the Responsible Jewellery Council (RJC), and the International Colored Gemstone Association (ICA). When gemstones are certified to these standards, formalized miners are directly rewarded for their efforts: certified stones can pe*****te high-end markets, attract better prices, and drive real business growth.Systems that reward miners with fair, verifiable value are the only proven way to reduce smuggling — because miners choose legal channels when legal pays better. That growth translates into higher royalties and taxes for government. Without certification and appraisal, “formalization” remains a cost with no return.
The export bans also impose a direct financial penalty on compliance. ASM licences are short-term — typically 1 to 2 years, with reserved minerals licences limited to 12 months. Miners must pay upfront licence fees and annual ground rent to keep them. Yet the February 2025 export ban and October 2025 raw gemstone ban have forced most licence holders to suspend operations. With no sales, miners cannot pay workers, leading to direct loss of livelihood and employment across mining communities. Their licences and ground rent obligations, however, continue to run. Unless the Ministry of Mining issues extensions, waivers, or credits for the ban period, these miners will be forced to renew licences they were barred from using — effectively paying twice for access to a market government itself closed. This is especially damaging given that 80% of the world’s gemstones are supplied by ASM, and the global gem market is projected to double to $102 billion by 2032. By supporting its ASM base, Malawi could position itself to capture real value from that growth — instead of regulating its own miners out of business.
An African Union study projects that the gem and jewellery industry in Africa is worth $20 billion annually, signalling that Africa is no longer just a producer of raw gemstones but also a major consumer and market. Under the African Continental Free Trade Area (AfCFTA), Malawi has duty-free access to that market. Yet without certification, appraisal, and beneficiation systems, Malawian miners cannot meet AfCFTA standards of origin or quality, and the country remains locked out of the very value chains it helped negotiate.
There are signs the government is starting to recognize this expertise gap. On April 17, 2026, officials from the Embassy of Malawi — Counsellor Yamikani Kadzakumanja and Second Secretary Felix Kasinda Mbewe — visited HRD Antwerp in Belgium to explore partnerships for delivering HRD Antwerp-standard gemmology training to Malawian students, both in Belgium and in Malawi. This move is commendable and shows government is trying to focus on the industry. However, it also underscores how the ones responsible to oversee the structured market have failed Malawians by not securing accredited expertise earlier.
According to the Malawi Government Annual Economic Report (2024), the country produced 793 metric tons of gemstones, yet earned only MWK 539.3 million in 2023/24, declining to MWK 453.7 million in 2024/25. This reflects systemic undervaluation. The prolonged export ban, imposed without proper valuation systems in place, worsened the loss: only MWK 70 million was collected in 2025/26 against a projected MWK 665.45 million — an 89% revenue shortfall. Small-scale miners produce the bulk of Malawi’s gemstones, but until certification and appraisal systems are introduced to capture true market value, both miner incomes and government revenue will continue to decline.
In summary, despite claims of a structured market, the current system rewards illegal miners and dealers rather than formalized miners who want fair value for their gemstones. Without certification and appraisal systems in place, Malawi will continue selling gemstones without knowing their true market value and will find it difficult to pe*****te high-end markets. The result is a sector where the most compliant actors are the least rewarded, national mineral wealth continues to leak across borders, and Malawi misses out on a $20 billion African market and a $102 billion global opportunity it is uniquely positioned to supply.
