Mining Sector Dominates License Issuance in Q2 2024
In the second quarter of 2024, the mining sector emerged as the leader in license issuance, surpassing other industries. During this period, a total of 65 mining licenses were granted, amounting to a value of $282.74 million.
By Ryan Chigoche
Overall, the Zimbabwe Investment and Development Agency (ZIDA) issued 154 licenses across various sectors, with a cumulative value of $1.8 billion. Among these, the mining sector was one of the standout performers. This robust activity underscores the sector’s pivotal role in the country’s economic landscape and its continued appeal to investors.
In addition to new licenses, there were 138 license renewals during the reported period, valued at $450.3 million. This demonstrates not only ongoing investor confidence but also the mining sector’s crucial contribution to sustained economic growth.
Following the mining sector, the manufacturing industry issued 35 licenses, with the highest total value of $745.08 million. The sectoral breakdown showed the manufacturing sector leading with 41% of the projected investment value, closely followed by the energy sector at 35% and the mining sector at 21%.
These significant figures highlight the sector’s substantial investment potential, though it was the mining licenses that dominated in terms of issuance volume and importance.
The strong performance of the mining sector in Q2 2024 reflects growing interest in resource exploration and development, which is expected to drive further investment and economic benefits in the future.
In the reported quarter, there was an increase of 8% in licenses issued compared to Q1 2024, indicating that investors are embracing ZIDA’s DIY licensing platform. However, there was a notable dip in timely renewals during the same period. As of 30 June 2024, only 29% of the projects licensed in 2022 were still operational, which is concerning.
Commenting on the agency’s Q2 update report, CEO Tafadzwa Chinamo said they are working tirelessly to close this gap.
“This performance leaves much to be desired, and with effect from 1 July 2024, the recently developed MCE framework through our CRM system shall be used to close this gap and ensure that the time aligns with international best practices,” Chinamo said.
The report also highlighted significant inflows of capital equipment and foreign currency. Capital equipment from abroad totaled $670.50 million, up from $202.54 million in the previous period.
The projected value of projects processed through ZIDA’s Business Development by the end of the second quarter was estimated at $14.9 billion, exceeding the half-year target of $7.5 billion.
The majority of these projected values, around 87%, are driven by investment opportunities in Infrastructure Development ($8.2 billion), Energy ($2.2 billion), Mining ($1.3 billion), Agriculture ($0.86 billion), and Tourism ($0.5 billion) sectors.
The increase in the number of licenses issued, despite a slight dip compared to the same period in 2023, suggests a continued strong interest and investment in the Zimbabwean economy.