Mining growth under threat

Business Reporter
THE Chamber of Mines of Zimbabwe will hold its 74th annual general meeting in Nyanga next week to deliberate on issues besetting the sector amid doubts the projected 17 percent growth target in the mining sector will be met this

year owing to the downswing in the prices of some minerals on the international market.

Mining and economic experts will converge on Troutbeck Resort on May 16 for the two-day event that will also be attended by ministers and high-profile officials from key economic ministries.

As has become the norm, Mines and Mining Development Minister Dr Obert Mpofu will be the guest of honour at the AGM where new leaders for the chamber will be elected.

Among the dignitaries expected to attend the mining AGM are Mines and Mining Development secretary Mr Prince Mupazvirihwo, Economic Planning and Investment Promotion permanent secretary Dr Desire Sibanda, Industry and Commerce permanent secretary Mrs Abigail Shoniwa and Parliamentary Portfolio Committee on Mines and Mining Development chairperson Mr Edward Chindori-Chininga.

Chamber of Mines president Mr Winston Chitando, the chamber’s immediate past president Mr Victor Gapare, outgoing CZI president Mr Kumbirai Katsande, South Africa minerals economist Dr Paul Jordan, Deloitte & Touche partner Mr Godknows Njowa and World Bank senior economist Ms Nadia Piffaraetti will present papers on various topical mining issues.

Addressing the media at a Press briefing yesterday Mr Chitando said the AGM would be held under the theme “Where to From Here: Managing and Developing the Mineral Wealth of Zimbabwe for Tomorrow”.

He said the main objectives at this year’s AGM included generating debate on the best practices in mineral resource management, developing common understanding measures to position Zimbabwe to attract capital into mining and preparing for future mining contribution to growth.

The forthcoming AGM would also focus on ways of creating the necessary platforms for greater co-operation between the private sector and Government institutions.

“It is our hope that if we achieve these objectives, we would have laid a solid foundation, in line with our theme, to manage and develop the mineral wealth of Zimbabwe for tomorrow,” Mr Chitando said.

But the negative effect of falling commodity prices to projected mining growth over the last three months would dampen spirits already depressed by issues besetting the sector.

Furthermore, reaching a consensus on the real contribution of mining to the economy would dominate the AGM.

The Chamber of Mines president said that a down-slide in the prices of major commodities exported by Zimbabwe might result in the country missing the 17 percent growth target that Finance Minister Tendai Biti projected when he presented the National Budget in November last year.

“We may fall short because, as you may be aware, the prices of commodities are fluctuating at the moment,” Mr Chitando said. He singled out high taxation charges on the mining sector, high cost of electricity and funding, proposed amendments to the Mines and Minerals Act as part of issues troubling the sector.

The mining sector is also already buckling under financial strain and requires, according to the chamber, between US$5 billion and US$7 billion to recapitalise operations over the next five years.

Meanwhile, Government is considering auctioning mineral deposits, restricting production of commodities deemed strategic and having the State sell the output from all mines, according to a draft proposal.

The proposals are made in a minerals policy prepared by the Ministry of Mines and Mining Development, which is yet to be made public.

Mines secretary Mr Mupazvirihwo told international media yesterday that the ministry would start discussing the policy with the mining industry tomorrow.

The country needs “an open, transparent and competitive auction procedure for known mineral deposits. The State of Zimbabwe reserves the right to market the people’s mineral assets, but undertakes to recompense the miner at fair and transparent market prices for mineral exports,” the ministry says in the policy.

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