Time up for mining sector speculators
Mining is an important sector in the country.
It is the biggest foreign currency earner and is one of the biggest employers. It also contributes a lot to community development as many towns have developed around mines while some companies are building roads, dams and other public infrastructure.
Experts say most of the minerals that the country is endowed with have not been mined yet. There are still thousands upon thousands of tonnes of gold, lithium, chrome and platinum; millions of carats of diamond, rare earths and so on that are still to be exploited.
This means that while mining has helped build this economy, it still has much more potential to contribute.
But one impediment, among a number, frustrating progress is speculative holding of concessions of many minerals by some companies.
The companies have, the Government has often said, sat on the assets for inordinately long periods. Since the companies are holding on to the concessions, they remain dead assets.
It is in that direction that, some two years ago, the Government announced a use-it-or-lose-it policy, which means that any company that continues to hold rights to a concession must begin mining; if they don’t, they lose the rights to other companies that are willing and able to start mining immediately.
It is according to that policy that the Government, as Minister of Mines and Mining Development, Winston Chitando told us this week, has repossessed as many as 80 concessions across the country.
“The use-it-or-lose-it policy has been implemented. We will have formal announcements in due course. But we have repossessed over 80 assets and we will do a formal update on that, and we will continue to do that (repossessing),” he said.
“We have always warned that the time was up for all those mining title holders who were holding onto the concessions for speculative tendencies at the expense of the country.
Under the ‘Zimbabwe is open for business’ mantra, those repossessed assets will be reallocated to potential investors who really want them for productive purpose in line with the National Development Strategy 1 agenda.”
We take the repossession, done in terms of the Mines and Minerals Act, as the first necessary step to addressing an unfortunate anomaly hindering the development of the relevant sector and the wider economy at large.
Now we ask that the Government moves speedily to allocate the assets to companies which have capacity to mine, but had been unable to do so because some were hoarding valuable ground for selfish interests.
It is our hope too that the new owners will hit the ground running and not behave like the former owners who were greedy and just sitting on value.
The reallocation will unleash the potential that the mining sector has. The country will be able to generate more foreign currency, more jobs would be created, more community development would be realised and so on.
In 2019, President Mnangagwa launched a mining industry strategic roadmap to build a US$12 billion sector by 2023. Under the road map, coal, chrome, diamond, iron and steel are envisaged to contribute US$1 billion to the economy.
The projected increase represents a 344 percent jump from US$2, 7 billion achieved in 2017. By 2030 the Government expects that the mining industry alone would be generating more than US$20 billion.
These targets would be met and surpassed if the assets that have been dead for many years, find new investors who will immediately work them for their profit and greater good of the economy.
The Chronicle