Reprieve for platinum miners Minister Chidhakwa
Minister Chidhakwa

Minister Chidhakwa

Golden Sibanda Senior Business Reporter
CABINET last week suspended the 15 percent tax on raw exports of platinum for a period of two years to allow mining companies more time to set up platinum beneficiation facilities.

This allows the country’s mines to continue exporting raw platinum group metals without being subjected to the contentious tax.

The Ministry of Finance had early this year gazetted a statutory instrument effecting Government’s decision to subject raw PGMs to the export levy.

As such, the platinum mining companies had been lobbying for the removal of the tax arguing it rendered operations unviable in the wake of falling PGM prices.

In fact, the companies briefly suspended exports in April this year arguing that they could not continue due to the impact of tax on gross proceeds of sales.

Mines and Mining Development Minister Walter Chidhakwa confirmed last week that Cabinet agreed to give the mines until 2016 to set up the facilities.

“The Cabinet accepted the report I presented due to the fact that miners made commitment that they should, by 2016, be able to complete expansion of the smelter at Zimplats.

“On the strength of that, Cabinet allowed that they be given two years to implement their plans.

“We are confident that we will ensure they do so not only in two years, but even within a shorter period,” the minister said.

Expansion of the Zimplats smelter will result in the plant having capacity to process concentrate from other local producers, which will increase the PGMs’ value.

Minister Chidhakwa expressed hope that within the next two years Government would ensure that all concentrate from local mines is converted to matte.

Zimbabwe has three platinum producing mines namely Implats subsidiary; Zimplats, Implats and Aquarius 50-50 joint venture; Mimosa and Anglo American’s Unki.

Mimosa and Unki both export PGM in concentrate form, while Zimplats exports matte, a further next stage in the flow of the platinum group metals processing.

Minister Chidhakwa said the base metal refinery is the only outstanding part of beneficiation process.

In 2013, former Mines Minister Obert Mpofu threatened to ban raw export of PGMs at the expiry of another two-year ultimatum he had given the mining firms.

Government, in line with provisions of its medium term policy, Zim-Asset, identified beneficiation and value addition of resources as one of the four main clusters.

The policy thrust is meant to ensure that the country derives optimum benefits from the exploitation of its abundant, but finite natural resources to alleviate poverty.

Zimbabwe is home to the world’s second biggest known deposits of platinum after South Africa, with platinum being Zimbabwe’s biggest foreign currency earner.

Government feels the country loses a lot of value due to export of PGMs in raw form. The PGM minerals are refined in South Africa and sold for higher value.

However, the miners have often argued that the country was not ready to for refineries citing low PGM volumes, cost of the exercise and shortages of power.

You Might Also Like

Comments

Take our Survey

We value your opinion! Take a moment to complete our survey