Mining: Centrepiece of Zim’s recovery and growth

MOST economic analysts believe strongly that the mining sector could easily be the centrepiece of Zimbabwe’s economic recovery and growth if sound policies and an investment friendly environment are promoted.

They say it could generate growth spurts across all sectors, reignite that economic miracle which the country desperate needs to improve foreign currency inflows and create jobs.

In addition, they say the country should move towards beneficiation of all its mineral resources to improve its earnings.

“The growing prominence of the sector can be traced to the leading role the sector had during the recovery of the economy from a decade-long downturn since 2009 growing by double digits and faster than all other sectors between 2009 and 2012,” a Chamber of Mines official remarked recently.

“In spite of a slowdown in mining sector growth between 2014 and 2015, the industry remains key to the long-term, sustainable growth of the economy.”

The official said in the long term, the mining sector was envisaged to play an even greater role through mineral beneficiation/value addition, procurement and other broad-based inter-sectorial linkages.

“It is my conviction that once the sector gets necessary information support, it can drive the mining industry towards sustainable growth,” he said in a report.

Zimbabwe has more than 40 minerals, with a diverse mining sector with more than 800 operating mines ranging from artisanal and small-scale mines to world class mines.

Key issues that Zimbabwean mining firms need to do include:

— Down-stream beneficiation – value addition that includes large-scale capital-intensive activities such as smelting and refining as well as labour-intensive activities such as craft jewellery and metal fabrication

— Mining beneficiation – capabilities of the mining company in the areas of smelting or concentration

— Manufacturing beneficiation – when manufacturing companies have capabilities to produce a final consumer products

— Side-stream beneficiation - Refers to inputs, namely capital goods, consumable and services added to the value chain supported by mining companies in Zimbabwe as well as policy makers

To a large extent, mineral beneficiation is already taking place in the country.

Zimbabwe is endowed with abundant mineral resources and indeed mining can become the cornerstone of an economic turnaround. The Chamber of Mines says Zimbabwe needs to: — resuscitate existing mines on care and maintenance to pre-1998 levels — invest in exploration and new mining development — focus on value addition and beneficiation — focus on linkages To achieve this, the miners’ grouping says Zimbabwe needs to address the following issues: — A common national vision — Policy consistency. Mining policy in progress. To now focus on economic and industrial policies. — Competitive fiscal regime — attract investment to the sector — Improve critical infrastructure, i.e. electricity, roads and water supplies

New Mines and Mining Development Minister Winston Chitando says Government has gone a long way in making the country a destination for mining investment.

The vision, he says, will be driven by increased capacity utilisation, ability to raise capital and a commitment to exploration.

These three areas, coupled with policy clarity and consistency, he says, will make Zimbabwe a preferred destination for mining investment.

“The vision is to create the necessary confidence so that Zimbabwe becomes the destination of choice for mining investment.

“When we develop whatever policy or framework, we will not necessarily always agree as Government and the Chamber of Mines, but what is important for any issue that is raised is discussion. We agree or disagree and where there is agreement, implementation has to be done timeously, that’s important and that will create the necessary confidence once we have policy clarity and consistency,” Ministry Chitando was quoted saying.

“As part of the vision, there are things that are fundamental to this industry - capacity utilisation is very low apart from platinum which is at 100 percent. So it’s important to target increased capacity utilisation, that’s the first thing. Secondly, there is need for new capital to open new mines and thirdly, Zimbabwe is underexplored.”

And already with changes that have brought clarity on the country’s indigenisation laws, Zimbabwe is on the path to being one of the leading mining investment destinations in the world.

Experts already tout that the country has a great potential to attract $12 billion in foreign direct investment over the next five years.