Policy inconsistency a hindrance to US$12 Billion Mining Industry
The Chamber of Mines of Zimbabwe (CoMZ) has bemoaned policy inconsistency by the government saying this can scuttle efforts to attain the envisaged US$12 billion mining industry economy by 2023.
Benard Rinomhota
Towards the end of last year, the government launched a strategic road map to achieve the targeted US$12 billion mining industry economy.
At present, the mining sector, which is the major centrepiece of the economy contributes close to US$4 billion to the fiscus.
Under the US$12 billion mining road map, gold is expected to contribute US$4 billion, platinum US$3 billion while chrome, iron, diamond, and coal will contribute US$1 billion.
Lithium is expected to contribute US$500 million while other minerals are anticipated to account for US$1,5 billion.
CoMZ president Mrs. Elizabeth Nerwande-Chibanda said achieving the envisioned result was not an easy task and thus a more coordinated and organised approach on the legal regulatory at fiscal and monetary policy should be embraced.
“It’s not easy and we have been lobbying with the government in all the areas that we feel that there have been hiccups.
“And l must say since December 2019, we have had very good liason, we have been consulted on a lot of policy issues.
“But lately there has been a bit of disappointment where we have seen a lot of policy inconsistency, so we keep engaging the government.
“And we say it (US$12 billion) cannot be attained for as long as there is policy inconsistency,” she said.
The CoMZ president said the capital shortage has also remained as one of the issues that have seen some expansion projects being put on hold by different mining firms.
“We are also aware of the inadequate foreign exchange retentions, uncompetitive prices for the surrender portion and gold has suffered a lot.”
In May this year, Fidelity Printers and Refiners announced a new gold trading framework where large scale producers are now being paid 70% of the sale proceeds in forex through their Nostro accounts while remaining 30% in local currency.
With such a payment model, the miners have said they are limited to accessing the much-needed foreign currency for procuring mining consumables.
Mrs. Nerwande-Chibanda also pointed out that power supply is still fragile to support operations by the mining sector.
“However, because of the little demand given most factories having closed, we saw quite a gap of recovery but this problem hasn’t been quite solved totally,” she said.
This article first appeared in the August 2020 issue of the Mining Zimbabwe Magazine