Mining capitalisation critical

27 Nov, 2020 - 00:11 0 Views
Mining capitalisation critical Minister Chitando

The Herald

Ishemunyoro Chingwere 

THE Government has allocated $1, 4 billion to the Ministry of Mines and Mining Development as it seeks to better coordinate the envisaged growth expected in the mining sector in 2021.

Presenting the 2021 National Budget, Finance and Economic Development Minister Professor Mthuli Ncube, said the mining sector is projected to rebound by 11 percent next year after surviving Covid-19 induced shocks that saw the sector contracting 4,7 percent in 2020.

The marginal contraction at a time a total plunge was expected, was as a result of firming international mineral prices especially for precious minerals, Government support structures under the Stimulus Package as well as Government’s decision to allow mining operations to continue under strict Covid-19 mitigatory measures.

With the sector poised for sustained growth towards the attainment of the 2023 milestone by which it should generate US$12 billion in annual exports, treasury envisages a more administrative role for the mines ministry in driving the set target. 

“In 2021, the mining industry is projected to rebound by 11 percent driven by planned expansion programmes aimed at increasing production by miners as we move towards the attainment of US$12 billion industry,” said Minister Ncube.

“The programmes include increased exploration, expansion of existing mining projects, resuscitation of closed mines, opening of new mines and mineral beneficiation and value addition.

“To achieve the desired growth target, Government will undertake . . . capacitation of the Ministry of Mines and Mining Development. 

“Government recognises the importance of capacitating the Ministry of Mines and Mining Development headed by Minister Winston Chitando for the country to derive value from its minerals.

“Therefore, the Budget allocates a total of $1,4 billion towards the operations of the Ministry for planning, promotion of exploration, data capturing and automation, among other key mining processes,” he said. 

Other factors necessary for achievement of the US$12 billion target, Minister Ncube said, include a stable macroeconomic environment, policy consistent and availability of long-term capital to fund mining projects along the entire mineral value chain. 

All these factors were the whole mark of the Transitional Stabilisation Program (TSP) and will continue under the National Development Strategy (NDS 1). 

Minister Ncube said Treasury will also seek capitalisation of the Mining Industry Loan Fund which supports small-scale miners through prospecting grants, mining establishment loans, plant and equipment procurement loans, among others.

This fund will get an allocation of $198,5 million. 

Government has repeatedly stressed the importance of the small scale mining industry due to the fact that the geology of the country dictates that some deposits are more amenable to small scale mining than conglomerate mining. 

Government has identified mining and agriculture as major pillars that are meant to anchor the country economic recovery and hence massive support for the two sectors.

Share This:

Sponsored Links